SIOUX FALLS AREA ACTION AGENDA WORKFORCE SUSTAINABILITY ANALYSIS
Submitted by Market Street Services, Inc. www.marketstreetservices.com
April 2015
TABLE OF CONTENTS
Process Overview ...... 1 Introduction ...... 3 Methodology ...... 4 Workforce Sustainability Analysis ...... 6 Existing Research Review ...... 6 How has our Population Grown and Changed? ...... 14 Key Findings ...... 20 How has our Economy and Workforce changed? ...... 22 Key Findings ...... 29 What issues are our employers facing today in terms of workforce availability? ...... 30 Key findings ...... 37 What can we expect in the next decade? ...... 38 Key Findings ...... 43 Are we developing sufficient talent to meet demand? ...... 45 K-12 Schools ...... 45 Higher education ...... 49 City, State, and regional Programs ...... 55 Key Findings ...... 58 Conclusion ...... 59 Key Questions ...... 60 Appendix A: Occupational Breakout ...... 63 Information Technology ...... 64 HealthCare ...... 66 Finance and Customer-care ...... 68 Advanced Manufacturing ...... 70 Biotechnology ...... 72
Workforce Sustainability Analysis
PROCESS OVERVIEW Implementation of the 2009 Future Sioux Falls community and economic development strategic plan has led to a number of accomplishments, many of which have contributed to the Sioux Falls area appearing at the top of national rankings and earning accolades and recognition throughout the Great Recession and its aftermath. A robust economy and the completion of several key efforts – including the Sioux Falls Tomorrow III report, the 2025 Downtown Plan, and the Cultural Plan Update – provide significant momentum for taking the region to the next level.
Recent efforts at the state-level that have begun to look more closely at workforce opportunities and challenges provide a strong foundation of knowledge that can inform the strategic efforts of regional leaders in the Sioux Falls area. Ultimately, the question that repeatedly rises to the top of discussions is, “How can we best develop our workforce to ensure that we are fully prepared for the opportunities to come?”
To answer this question and take stock of the region’s overall progress, Forward Sioux Falls leadership has engaged Market Street Services to facilitate a six-month talent-focused process that leverages recent and existing studies and initiatives and is led by a Task Force that includes business, government, and education leaders, as well as investors and leaders from the Sioux Falls Development Foundation and the Sioux Falls Area Chamber of Commerce.
This process will assess where the region is now in terms of its competitive position; provide an in-depth understanding of both education and training needs and the sustainability of the workforce; and will result in the development of strategic actions that focus specifically on workforce and training needs.
PHASE 1: PROJECT INITIATION AND STAKEHOLDER INPUT The six-month process began with a familiarization tour of the region for the Market Street team and a series of focus group and interview sessions. An online survey was developed to ensure that all key voices are heard. Input session participants provided feedback about a broad array of competitive issues and also drilled down on issues related to short and long-term workforce needs and opportunities.
PHASE 2: COMPETITIVE ASSESSMENT The report provided an analysis of the Sioux Falls area’s competitive dynamics to assess how the region is performing compared to peer and aspirational communities and also evaluated the Sioux Falls area compared to its performance in years past. Five “scorecards” were used to rank the region’s performance using a wide variety of data indicators.
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PHASE 3: WORKFORCE SUSTAINABILITY ANALYSIS This phase of the process takes the Workforce Competitiveness scorecard from Phase 2 a step further by adding a detailed analysis of how well the region is positioned to take advantage of future economic opportunities while also filling immediate workforce needs. The Analysis is conducted through the lens of the region’s existing target sectors and incorporates ten-year projection-based data. Feedback received from employers and training providers was reviewed and incorporated alongside quantitative data.
PHASE 4: STRATEGIC WORKFORCE ACTION AGENDA AND IMPLEMENTATION GUIDELINES The Strategic Workforce Action Agenda will build on the findings from the first three phases. While it is impossible to predict the specifics of what could be included in the Action Agenda, it is expected that there will be strategies that focus on immediate, mid-term, and long-term needs and opportunities. Once the Action Agenda has outlined the strategic items that will need to be implemented, Implementation Guidelines will be developed that address how the Action Agenda can be operationalized.
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INTRODUCTION The Sioux Falls region has made significant efforts over the past several years to support its local economy and improve the quality of life for its residents through developments in its aesthetics, community offerings, and other strategies. Input participants spoke highly about the area’s family friendly environment, quality amenities, and positive improvements that have been made recently. The Sanford PREMIER Center, the Big Sioux River Greenway, and downtown developments were among the top cited assets throughout input. However, the sustained growth and development the Sioux Falls area has experienced in recent years is under threat from pervasive issues related to its workforce capacity and skills dynamics. This Action Agenda process seeks to address these issues through assessment of current conditions and future needs with a goal of developing an action plan to address them.
The Workforce Sustainability Analysis is framed to provide a fresh look at the workforce capacity of the region beginning with how the population has grown. Migration patterns and characteristics of new residents are provided to give an understanding of how the area has developed, while the age composition and educational attainment provides context for workforce sustainability issues.
Following analysis of the region’s population growth and composition, the metro’s economic landscape is examined at the macro-level in order to have an understanding of the subsequent sections that discuss detailed occupational growth. The area’s largest occupations, fastest growing employment trends, and most concentrated jobs will be provided.
Next we will examine the workforce issues faced by Sioux Falls area employers. In doing so, we will identify the top in-demand occupations where employers are facing the most hiring difficulties. In this section we will combine the qualitative input received through focus groups, interviews, and the online survey, with quantitative data in order to zero in on which occupations have the greatest number of job openings and begin exploring possible disconnects between the skill sets residents have and those that are required to fill employment gaps.
Armed with an understanding of current workforce issues, we will then look to what the region can expect in the decade to come. Here we will provide information regarding which occupations are most susceptible to shrinkage caused by potential technological advancements and the jobs that are projected to decline the fastest over the next ten years. Also provided are the top occupations that are most at-risk for impending retirements and the type of impact they may have on the region. We will then provide a list of occupations that are projected to grow nationally and how well the region is positioned to capture the growth of those jobs.
Following this we will examine Sioux Falls’ ability to produce talent within the region and meet the needs of its employers. The area’s public K-12 schools, higher education institutions, and city, state, and regional programs will be detailed in order to identify current offerings and seek to determine if the region is prepared for what’s to come.
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Finally, we will answer key questions about the region’s workforce in the Conclusion. The Appendix provides the occupational composition of some of the region’s most influential and targeted sectors with detailed tables that provide historical content, projected growth, earnings ratios, and educational requirements.
Methodology Location Quotients: Location quotients (LQs) are used to measure the relative concentration of local employment in a given business sector or occupation. When applied to business sector employment, they measure the ratio of a business sector’s share of total local employment to that business sector’s share of total national employment. A business sector with LQ of 1.0 is exactly the same share of total local employment as that business sector’s share of national employment. When a local business sector has a location quotient greater than 1.0, it signals that the business sector is more heavily concentrated in the metro than it is nationwide. Those business sectors with relatively high LQs are often assumed to benefit from one or more sources of competitive advantage derived from locating in the area being examined. Location quotients are also applied to occupational employment in the same manner that they are applied to business sector employment, helping to determine which occupations and corresponding skill sets— irrespective of the business sectors that employ them—are highly concentrated in the local workforce.
Wages and Earnings: The average annual wage (AAW) is calculated by dividing total earnings by total employment for the business sector. When used in the context of occupations, the average annual earnings was calculated by multiplying the average hourly earnings by 2,080 hours, the number of hours worked in a year by a full-time employee.
U.S. Earnings Ratio: Earnings ratio refers to the ratio of local average earnings (wages plus supplements) to the national average for that same sector. This helps provide an important perspective on the relative cost of labor in a community.
Job Openings: The job openings indicator refers to the new jobs and replacement jobs. New jobs are those that are created out of growth. Replacement jobs stems from employees changing occupations, retiring, or leaving the labor force. This indicator is used to estimate the labor market demand for an occupation.
Completions: All completions for programs associated with an occupation and offered by institutions falling within the region of study. This indicator is used to estimate the labor market supply for an occupation.
Suppressions: Occupations with less than 10 jobs were not included in the analysis of education requirements of jobs. This represented one percent of all jobs in the MSA. In the detailed analysis of the percentage of workers over the age of 55, some employment was suppressed due to data limitations.
Geography: The Sioux Falls metropolitan statistical area (MSA) was used throughout the analysis of the report. Any sections in the report that refer to “Sioux Falls” is in reference to the four-county region.
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However, the education and training was analyzed through both the local, MSA-designated geography lens, as well as the greater region’s institutional offerings that are available within approximately 60 miles of Sioux Falls. Input revealed that while the Sioux Falls MSA does not have its own full public four-year university, the greater region’s educational offerings that include Dakota State University (DSU) in Madison, SD; South Dakota State University (SDSU) in Brookings, SD; and University of South Dakota (USD) in Vermillion, SD should be taken into account in certain areas.
Data Sources: The Workforce Sustainability Analysis presents a variety of data points covering concepts such as business sector employment composition, wages, occupational composition, demographics, unemployment, and job openings. All of the aforementioned quantitative data is sourced from Economic Modeling Specialists, Inc. (EMSI), an industry-leading provider of proprietary data, aggregated from public sources such as the Census Bureau, the Bureau of Labor Statistics (BLS), the Bureau of Economic Analysis, the National Center for Education Statistics (NCES), CareerBuilder, and many others. EMSI was acquired by CareerBuilder in 2012. Additionally, data directly from the Census Bureau, the Bureau of Labor Statistics, and the National Center for Education Statistics were included in the analysis.
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WORKFORCE SUSTAINABILITY ANALYSIS
Existing Research Review Before taking a fresh look at workforce sustainability in the Sioux Falls region in 2015 and beyond, it is important to establish some common understanding of the pre-existing research on the issue, including key findings from:
The Future Sioux Falls strategic planning process (2010) Governor’s Workforce Summits: Final Report, South Dakota Workforce Initiatives (SD WINS) Workforce Summits (2014) Growth and Change in South Dakota Labor Markets, Drexel University Center for Labor Markets and Policy (2014) The Competitive Assessment that comprised phase two of this process (2015)
FUTURE SIOUX FALLS (2010) From 2009-2010, Market Street Services worked with Forward Sioux Falls, the City of Sioux Falls, Minnehaha and Lincoln Counties, the Sioux Falls Area Community Foundation, the Sioux Empire United Way, and a dedicated Steering Committee to facilitate the creation of a new strategy to enhance economic and community development activities in the Sioux Falls area. This process, Future Sioux Falls, began with a Competitive Assessment that identified a number of trends and issues facing the region related to workforce sustainability as the first decade of the new millennium came to a close, a time when the United States was mired in the Great Recession.
In-migration dynamics suggested that Sioux Falls was a community-of-choice for many families: Domestic in-migration fed population growth in Sioux Falls in the 2000s. The region pulled most new residents from rural areas of South Dakota, Northwest Iowa, and Southwest Minnesota. The region was also able to attract new residents from other metro areas including Fargo, Bismarck, Duluth, Salt Lake, Los Angeles, Las Vegas, and Austin.
Reported “brain drain” issues: Between 2000 and 2007, Greater Sioux Falls experienced net out- migration of residents to Minneapolis, Omaha, Lincoln, Des Moines, and Denver. “There need to be more jobs for these young professionals and more advancement,” said one survey respondent. “All the great talent that the city might have had the chance to keep is just leaving.” Many other survey participants mentioned Sioux Falls’ lack of entertainment and retail amenities as a problem in attracting and retaining the “best and brightest.” Continuing to improve the Downtown area, increasing lifestyle options, and developing places with “character” and “atmosphere” were cited by input participants as ways to improve the region’s ability to attract and retain young talent.
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Educational attainment levels lagged behind peer communities: The educational attainment levels of adults age 25 and over was competitive with state and national standards; however, Sioux Falls lagged behind its peer communities in terms of the proportion of adults who held an associate’s, bachelor’s, and/or master’s degree.
Competitive public school systems, but concerns about keeping up with demand: Eighty-four percent of survey participants enrolled or with children enrolled in area schools rated the quality of the education as “very good” or “good”. However, with record elementary school enrollments in multiple metro districts, many stakeholders were concerned about these districts’ abilities to keep up with burgeoning demand.
Comparatively smaller higher education capacity and limited workforce development resources: Educational options at the two-year and four-year levels in the metro area were found to be fairly limited. Even when considering state universities within an hour’s drive time, Greater Sioux Falls still had a smaller higher education capacity (in terms of enrollments) than its peer regions. It was observed that the state’s unique community and technical college structure limits workforce development opportunities available in Sioux Falls compared to many places that receive state funds for two-year colleges.
Multiple hurdles to higher education access: Funding issues for students at the University Center, no state community college system, and limited degree program availability and flexibility within the metro area were identified as top concerns. Creating and maintaining a pipeline of “knowledge workers” was viewed as critical to the long-term competitiveness of Sioux Falls’ regional economy.
Low but rising unemployment, high but declining labor force participation: The region was historically characterized by exceptionally low unemployment and high labor force participation, signs of a particularly tight labor market. In July 2009, the metro area’s unemployment rate was 4.8 percent compared to 9.7 percent nationwide, rising over the most recent year at a pace that was comparable to the statewide and peer community averages. Between 2000 and 2008, labor force participation declined slightly, from 78 percent to 76 percent nationwide. During that same period, labor force participation declined from 92 to 84 percent in Sioux Falls
Average wages lagged behind peer communities and were growing at a slower rate: In the fourth quarter of 2008, the average annual wage in the region was $38,221 compared to wages ranging from $38,403 to $49,197 in the peer regions examined (the Des Moines, Fargo, and Rochester metropolitan areas). Furthermore, while the Sioux Falls Area posted very strong five- year employment growth figures, its five-year rate of wage growth fell behind all benchmark communities, the state, and the nation.
GROWTH AND CHANGE IN SOUTH DAKOTA LABOR MARKETS (2014) The report “Growth and Change in South Dakota Labor Markets: An Assessment of the State’s Labor Market Imbalances in a Weak National Recovery,” produced by the Drexel University Center for Labor Markets and
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Policy, was released in February 2014. This report examined a number of macroeconomic conditions and trends that reflected the historical and current labor market conditions in South Dakota, and the manner in which these conditions impacted the state’s workforce competitiveness. The report validated many previously held assumptions and long-standing trends, such as the tight labor market and full employment conditions that have, by and large, characterized the state for decades. The following excerpts from the report highlight some of its key findings:
“With its high rate of labor force attachment South Dakota has about 40,000 more persons supplying labor than would be expected if the rate of labor force attachment in the state was equal to the nation as a whole. This represents a very important advantage to South Dakota.”
“The evidence is clear that the primary labor market problem that has characterized the U.S. job market over the last five years has been a very large excess supply of labor at prevailing market wages…Yet despite the poor national context, South Dakota’s job market appears to have minimal excess labor supply. Instead, a growing problem in the state is increasing labor scarcity…Given the statistical relationships between unemployment rates and job vacancy rates in the U.S., we speculate that there is essentially 1 unemployed worker for every job opening in the state; a full-employment condition.”
“College labor market occupations including managers, business and financial operations, computer and mathematical science occupations, engineering and health care professions all had unemployment rates below two percent—signaling labor scarcity in these professional areas. In contrast, we found a number of occupations that had very high unemployment rates including food preparation and service workers and protective service worker occupational groups, both of which had unemployment rates of around 9 percent among those who had worked in these occupations in the past. Our findings suggest that occupations that require little skill or education were more often characterized by substantial excess labor supply conditions while occupations requiring considerable schooling and/or experience were characterized by labor scarcity in South Dakota.”
“We found evidence of labor supply shortfalls in all three of the durable goods manufacturing industries that compete for many of the same worker skills, especially in welding and machine trades and operatives- related occupations, and engineering fields.”
“Several (manufacturing) firms reported increased use of capital as a substitute for increasingly scarce blue- collar labor. Robotics and CAD/CAM and 3D printing may be technologies that may render some of the blue-collar skills currently in demand obsolete in the future.”
“Many firms found engineering and computer science-related occupational job openings difficult to fill. These firms compete in national labor markets against often large firms in major metropolitan areas.”
Source: Growth and Change in South Dakota Labor Markets: An Assessment of the State’s Labor Market Imbalances in a Weak National Recovery,” Neeta P. Fogg and Paul E. Harrington, Drexel University Center for Labor Markets and Policy (February 2014).
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GOVERNOR’S WORKFORCE SUMMITS (2014) In 2014, Governor Dennis Daugaard convened a series of Workforce Summits in six regions around the state of South Dakota to promote discussion among state, community, business, and education leaders regarding the workforce challenges and opportunities facing each region.
A total of 251 individuals attended the Sioux Falls Summit on June 17th, 2014. The discussions that took place at this Summit have helped set the stage for this Workforce Sustainability Analysis and the forthcoming Strategic Workforce Action Agenda.
According to the Governor’s Workforce Summits: Final Report (August 2014), there were a few common themes that arose from the summits held across the state:
1. Having enough people with the right skills and competencies is the key to success: South Dakota’s economic success is tied to having enough people with the right skills and capabilities for South Dakota jobs. This is an urgent issue requiring continued concentrated attention and effort.
2. Employers need more ways to access and support a workforce with needed skills and competencies: Businesses cannot find enough of the right skills at the right time, and need support from educational institutions, communities and government to attract and retain workers.
3. Students and job seekers need more accurate views of career opportunities and employer expectations: Job seekers do not know the real potential of technical and other careers, or what is expected to succeed.
4. Educators are key to developing workforce skills and competencies: Education is critical to providing the workforce South Dakota needs, and must be focused on the skills and competencies needed to grow and sustain South Dakota’s economy.
5. All sectors must collaborate to address these issues: Every sector has a role to play individually, and as part of a unified workforce agenda.
Source: Governor’s Workforce Summits: Final Report (August 2014) produced by Accenture
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The Final Report also identified the following challenges as those that were most frequently cited across the state, with most of these challenges tied to the aforementioned common themes:
Young people, parents and educators have misperceptions of technical and other careers, and do not understand the opportunities these careers provide Many job seekers have unrealistic job/career expectations and do not know how or where to begin searching for jobs The education and training system needs to continually adjust to meet the current needs of the business community Access to education and training in Career Technical Education (CTE) and Science, Technology, Engineering and Math (STEM) fields is limited, especially in rural areas Some job seekers lack exposure to early real world work experience Employers struggle to find and attract workers who fit their business needs Communities struggle to recruit or attract new workers due to perceptions of limited work opportunities and community amenities in South Dakota Employers struggle to retain workers due to competition for available skills Workers want opportunities for professional growth and development at their jobs Job seekers’ soft skills do not always match employer expectations Communities lack available and affordable housing options to attract and retain workers Specialized services are required to support the integration of different cultures, disabled and multilingual populations into the workforce Source: Governor’s Workforce Summits: Final Report (August 2014) produced by Accenture
The Appendix to the Final Report provided a recap of the specific challenges discussed at each of the six Regional Summits, including the following concerns that were identified by participants at the Sioux Falls Summit:
1. Finding skilled/qualified workers 2. Disconnect between industry needs and education system 3. Insufficient wages/benefits to attract and retain talent 4. Lack of student awareness of career development opportunities 5. Lack of school/business partnerships that allow students early exposure to the workforce 6. Lack of education/technical training opportunities 7. Limited career development opportunities for entry level/new populations 8. Limited education/training on soft-skills Source: Governor’s Workforce Summits: Final Report (August 2014) produced by Accenture
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COMPETITIVE ASSESSMENT (2015) The Competitive Assessment that preceded this Workforce Sustainability Analysis presented a series of scorecards that evaluated the region’s competitiveness across multiple indicators that helped measure how the Sioux Falls region has performed in recent years in a few key areas relative to a set of nine metropolitan areas with which the region competes for jobs and talent. The Workforce Capacity scorecard identified a few key trends relative to workforce sustainability that provide important context for the more detailed analysis that follows in the remainder of this report:
Population increases and labor force growth in metro Sioux Falls have slowed in recent years compared to historic trends, with the region now finding its growth rate in both indicators trailing many of the comparison communities. Net migration accounted for a higher percentage of the population change in the Sioux Falls area than the other metros, but lower than previously. Additionally, there has been a shift in migration patterns. Between 2003 and 2008, domestic migration accounted for roughly 55 percent of the population change, while between 2008 and 2013 it accounted for 43 percent of the change. However, those that are relocating to Sioux Falls are more educated than they have been historically; nearly 40 percent of all in- migrants to the Sioux Falls area and 37.6 percent of in-migrants from abroad had a bachelor’s degree or higher in 2013. Historically, only 18.7 percent of in-migrants from abroad had a bachelor’s degree or higher.
The dependency ratio suggests that Sioux Falls will have enough workers to replace those retiring over the next ten to 20 years. For every ten workers nearing the age of retirement (ages 45 to 64), there are 12 residents between the ages of 25 to 44 to replace them. Nevertheless, the advantageous dependency ratio is reliant upon the region’s ability to retain workers in the younger cohort. The Workforce Sustainability Analysis will further explore the occupational composition of greater Sioux Falls’ labor force and identify the business sectors most at risk for impending retirees and shortages in skilled workers.
In 2013, nearly half of the Sioux Falls MSA population between the ages of 18 and 24 had some college experience or an associate’s degree, ranking it 7th out of the comparison communities. “University towns” such as Fargo, Fort Collins, and Lincoln boasted populations with 60 percent or higher attaining some college or an associate’s degree within this age group – typical of communities with a large public university.
The most notable increases in greater Sioux Falls workforce competitiveness can be seen in the region’s rise in its adult population with a bachelor’s degree or higher since the 2009 study. Though its current attainment rates still trail many of the comparison areas, the percentage of adult residents in the Sioux Falls region with a bachelor’s degree or higher rose from 28.9 percent to 32.3 percent. This represented a 3.4 percentage point increase, which outpaced the rate of growth in every comparison community; nationally, the rate of increase over the five-year time period was 1.9 percentage points. The Sioux Falls area also saw more residents attend college in 2013 than in 2008, with 8.3 percent of the population over age 15 enrolled in higher education. Of those, roughly half the Sioux Falls area population enrolled in college was over the age of 25.
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Workforce Capacity Scorecard: Rankings Cedar Des Fort Sioux Boise Fargo Lincoln Madison Omaha Rochester Rapids Moines Collins Falls Population Change 5-yr population growth rate 21031467598 5-yr labor force growth rate 11069524873 Net migration as % of total population 59412768103 % of in-migrants w/bachelor's degree + 10973261854 % of in-migrants from abroad w/bachelor's degree +10294573816 Age Composition Dependency ratio (Age 25-44 / Age 45-64)69218475103 Workers age 55+ 25101694783 Educational Attainment % of population over 15 enrolled in college76913245108 Pop 18-24 w/some college or assoc. deg. 84932156107 Pop 25+ w/assoc. degree 10261847953 Pop 25+ w/bachelor's degree + 91045132758 5-yr pct. pt. chg. 18-24 w/some college or assoc. deg.26498735101 5-yr pct. pt. chg. w/assoc. degree 63918456102 5-yr pct. pt. chg. w/bachelor's degree + 67102548193 Average ranking score, all indicators 6.00 6.57 6.57 3.00 4.79 4.71 4.71 6.29 7.79 4.43 Average Ranking, All Indicators 68815337102
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Workforce Capacity Scorecard: Data Values
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How has our Population Grown and Changed? It is important to understand the Sioux Falls area’s population base before assessing the workforce, current challenges, future opportunities, and what these trends say about the sustainability of the workforce. Over the past decade, the population in the Sioux Falls MSA has grown rapidly, roughly two times faster than the growth rate in South Dakota and the nation. Between 2003 and 2013, population in the Sioux Falls area had a net increase of more than 40,000 people. However, of the four counties in the MSA, only Lincoln and Minnehaha County enjoyed the increased population base; population in McCook and Turner County has remained relatively unchanged over the past decade. The population growth was spread evenly between Lincoln and Minnehaha County, with each county having a net gain of roughly 20,000 residents.
FIGURE 1: POPULATION GROWTH
Source: U.S. Census Bureau
The components of population change reveal the foundation of the population growth. As was discussed by Market Street in the 2009 Future Sioux Falls Competitive Assessment, greater Sioux Falls has historically grown its population base by attracting residents from the surrounding counties in the state and region; domestic net migration has typically accounted for roughly half of the population growth in the metro area. Population growth stalled slightly between 2009 and 2011, mirroring national trends when mobility for many people was limited due to negative recessionary effects. Domestic migration declined between 2007 and 2011 but has since rebounded. Natural change (births minus deaths) has been consistent over the years. The notable change in population growth has been in the increase
Page 14 – April 2015 Workforce Sustainability Analysis in international migration. The positive net migration of international residents helped to soften the effects of the stalled domestic migration and provided employers with a new pool of workers.
FIGURE 2: COMPONENTS OF POPULATION CHANGE
Source: U.S. Census Bureau
Understanding which counties incoming residents are moving from offers insight to the areas of the country that are attracted to the Sioux Falls region. The Internal Revenue Service’s (IRS) Statistics of Income program helps to identify specific migration patterns based on the counties that tax payers file in each year. If an individual moves from one county to another between tax years, the program categorizes this individual as a migrant between counties.
The metro’s population growth has continued to pull largely from other counties in South Dakota and the surrounding states in the Midwest. Out of the top ten sources for new migrants to the area, seven are counties in South Dakota. The remaining three counties are located just over the South Dakota border in Iowa and Minnesota. These sources include top metros in South Dakota and neighboring states as well as South Dakota’s two principal public university locations. With a recovering economy, the Sioux Falls area will face stronger competition for workers and will need to compete with other metros across the nation to retain and attract talent.
The top destinations for Sioux Falls area out-migrants highlight some of the cities that the metro is competing with for talent. As suspected by input participants, Minneapolis is a magnet for some of the talent leaving Sioux Falls; Hennepin County accounted for a net loss of roughly 100 residents. There is a strong link between the two metros with approximately 1,050 people moving to Minneapolis MSA and 950 moving from it to Sioux Falls between 2006 and 2011. Denver, Rapid City, Phoenix, Des Moines, and Dallas are other large metro areas that stand as top destinations for residents leaving the Sioux Falls area.
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FIGURE 3: TOP SOURCES AND DESTINATIONS, 2006-11
Top Sources Top Desinations
Brookings County, SD 972 Pinal County, AZ -138 Davidson County, SD 560 Polk County, IA -107 Codington County, SD 429 Hennepin County, MN -94 Yankton County, SD 411 Maricopa County, AZ -86 Clay County, SD 402 Tarrant County, TX -79 Brown County, SD 374 Custer County, SD -72 Woodbury County, IA 320 Hidalgo County, TX -69 Lake County, SD 288 Pinellas County, FL -65 Sioux County, IA 273 Arapahoe County, CO -63
Rock County, MN 219 Campbell County, WY -46 Source: Internal Revenue Service
As reported in the Competitive Assessment, in-migrants to the Sioux Falls region are well-educated, having attained higher levels of degree attainment than all but three of the benchmark communities. Roughly 40 percent of individuals that moved to the Sioux Falls metro from another state had attained a bachelor’s degree or higher between 2011 and 2013. This indicates that the area is attracting an educated workforce, which increases the community’s overall educational attainment. However, there was disparity within the educational attainment of in-migrants from abroad; approximately 37 percent had less than a high school degree, while only 20 percent had a bachelor’s degree or above.
In-migrants to the Sioux Falls metro were also younger than the population already residing in the area. The median age in the Sioux Falls MSA was 35.2, while in-migrant ages ranged from 27.5 to 28.3; ages out- of-state migrants was 28 between 2011 and 2013. The younger age of in-migrants to the area has contributed to the advantageous age distribution in the Sioux Falls region. As discussed in the Competitive Assessment, the percentage of the population between the ages of 25 and 44 is larger than the population between the ages of 45 and 64. The younger cohort represents the future workers that will replace individuals that are likely to be retiring in the next ten to 20 years. The Sioux Falls metro also has a smaller share of its population over the age of 65 and a larger share under that age of 18 compared to South Dakota and the United States. Individuals under the age of 18 represent a potential supply of future workers if the community can retain and train them for in-demand occupations.
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FIGURE 4: AGE DISTRIBUTION, 2013
Source: U.S. Census Bureau
Fueled by domestic and international migration, greater Sioux Falls has continued to become more diverse. The region’s immigrant population is extremely diverse and represents a wide range of countries, languages, and cultures. In 2003, 92.3 percent of the population was white and not Hispanic; in 2013, that demographic represented 87.2 percent of residents. There’s been an increase in the share of the population among other races and ethnicity. The Hispanic population has doubled since 2003, while the population that reported as black, non-Hispanic has nearly tripled over the past decade. Input participants from all backgrounds spoke highly of how the community has embraced its growing diversity and felt that the Sioux Falls region was a very welcoming community. The Lutheran Social Serves Center for New Americas provides services to newly arriving refugees. Nevertheless, although the Sioux Falls area has made great strides in creating a welcoming community for its growing diversity and immigrant population – the Multi- cultural Center and Sioux Falls Diversity Council are cited as examples – representatives from community and social service organizations in the area reported continuing challenges with training additional translators as well as immigrants adjusting to English-only signage and forms.
Input participants also cited a lack of affordable housing as a challenge that has affected their ability to attract more residents to the area and provide for residents at various income levels. Zillow, the online real estate database, reported that the median price of homes currently listed in the Sioux Falls Metro was $185,000; comparatively, in the Omaha metro area, median home prices were $155,000 and $178,000 in Des Moines. This has reportedly caused talent retention and attraction issues, especially for younger professionals and immigrants. According to a recent article, as Sioux Falls home values and rental rates rise faster than incomes, keys statistics suggest the city is not making enough progress on affordable
Page 17 – April 2015 Workforce Sustainability Analysis housing supply. In a city where people wait years for subsidized housing, officials say Sioux Falls must figure out how to create enough affordable housing to reduce the need for more subsidies.1
When survey participants were asked to rank the seriousness of issues that the area was facing in attracting and/or retaining residents, responses were split between “not a problem” to “serious problem.” Even so, conversations with residents suggest that affordable housing remains an issue, One said, “I relocated here 2 years ago - our biggest problem with the move was finding affordable, single family houses. There were not many homes that were for sale when we moved that weren't run down or in our price range.”
Educational attainment in the Sioux Falls area still trails many competitor regions, but trends are improving. Roughly one-quarter of the population in the Sioux Falls area has received a bachelor’s degree. Its share of the population with a bachelor’s degree is 4.7 percentage points higher than the nation and 4.2 percentage points higher than South Dakota. In fact, the Sioux Falls metro area accounts for 28.9 percent of the state’s population that is 25 years or older, but accounts for 35.2 percent of population that has attained a bachelor’s degree.
FIGURE 5: EDUCATIONAL ATTAINMENT OF POPULATION AGED 25+, 2013
Source: U.S. Census Bureau
The educational attainment of the population in the Sioux Falls area has increased over the past five years along with a drop in the share of the population with less than a high school degree. Consequently, Sioux Falls stands out compared to some of the previous communities it was benchmarked against. Between 2008 and 2013, the share of the population that had an associate’s degree increased by 2.6 percentage points, while the share that had attained a bachelor’s degree or graduate/professional degree increased 2.1 and 1.3 percentage points, respectively.
1 Young, Steve. Rise in S.F. home values squeezes residents. Argus Leader, 2/11/15
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FIGURE 6: PERCENTAGE POINT CHANGE IN EDUCATIONAL ATTAINMENT, 2008-13
Sioux Falls Des Moines Fargo Rochester
Less than a high school degree 0.2% -1.3% 0.1% -1.0% High school degree -3.5% -0.2% -2.1% 2.1% Some college, no degree -2.8% -1.0% -1.8% -0.1% Associate's degree 2.6% 0.0% 3.4% -0.5% Bachelor's degree 2.1% 1.6% -0.2% -0.1%
Graduate or professional degree 1.3% 0.9% 0.6% -0.4%
Source: U.S. Census Bureau
While Sioux Falls has made strides in increasing the education level and training of its residents, to maintain or improve the sustainability of the workforce it will be important to ensure that the educational attainment of the population and the educational requirements of the local in-demand jobs are aligned. The Bureau of Labor Statistics provides detailed information about an occupation’s typical education and training requirements. The BLS collects data from the Census Bureau’s American Community Survey to analyze the education attained and the reported occupation of each survey respondent to determine what educational attainment is typical for a person working in that occupation. The BLS also takes into account changes in recent programs where new educational requirements are placed on individuals entering the occupation that were not previously required, such as certifications and higher levels of education. These requirements represent the minimum education needed for the occupation at the entry-level, and do not include the additional training or education required for more advanced jobs that fall within the occupational category2. The underlying assumptions used to determine educational requirements place limits on the data, but nevertheless offer insight to the economic landscape of a community and the alignment of local jobs and workers.
2 For more information on the methodology, visit http://www.bls.gov/emp/ep_education_tech.htm
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FIGURE 7: SHARE OF JOBS BASED ON EDUCATION REQUIREMENTS AND EDUCATION ATTAINED BY RESIDENTS, SIOUX FALLS MSA AND US
Source: U.S. Census Bureau; EMSI
Figure 7 illustrates the difference in the share of jobs by education required and the distribution of the education attained by the population over the age of 25 for the Sioux Falls MSA and the United States. The most striking finding in this analysis was the difference between greater Sioux Falls’ education required and education attained at the bachelor’s degree level, indicating a level of “underemployment” that is consistent with findings at the state level and reported by input participants. As previously stated, the percentage of the population in the Sioux Falls area with a bachelor’s degree is 4.7 percentage points higher than what is seen at the national level. However, despite having attained higher levels of education, the share of jobs that require a bachelor’s degree is smaller (- 3.1 pct. pt.) in the Sioux Falls area compared to the United States. Only 14.3 percent of jobs in the Sioux Falls MSA require a bachelor’s degree, while 17.4 percent of jobs across the United States require one. At the other end of the spectrum, a higher share of jobs in the Sioux Falls region do not require a degree compared to the nation, while a smaller percentage of the population has less than an associate’s degree; approximately three-quarters of jobs in the Sioux Falls area require less than an associated degree, while 55.2 percent of the population has attained that level of education.
KEY FINDINGS The Sioux Falls area’s population continues to rise steadily, but growth is uneven with only two of the region’s four counties, Lincoln and Minnehaha, experiencing increases. Most of the region’s growth is comprised by new residents migrating from other metro counties in South Dakota, although international migration has risen in recent years.
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In-migrants to greater Sioux Falls are younger and better educated than existing residents, helping to contribute to the region’s advantageous age dynamics. The region is also continuing to become more diverse.
A lack of affordable housing has been cited as a challenge for talent retention and attraction, especially for young professionals and recent immigrants and refugees.
Educational attainment in the Sioux Falls area still trails many competitor metros, but percentages are rising.
Underemployment is both a reported and statistically demonstrated reality, with many Sioux Falls area workers possessing higher levels of education than their jobs require.
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How has our Economy and Workforce changed? South Dakota has continued to operate with a high labor force participation rate and a low unemployment rate since Market Street’s last assessment in 2009. In 2013, it ranked fifth out of the states for the highest labor force participation rate and it had the second lowest unemployment rate. Those between the ages of 25 and 34 had the highest labor force participation rate in South Dakota at 86.5 percent. Of the population between the ages of 55 and 64, 75.2 percent were participants in the labor force.
FIGURE 8: EMPLOYMENT STATUS OF THE CIVILIAN NONINSTITUTIONAL POPULATION, 2013 ANNUAL AVERAGES Employment Unemployment Number Percent of Number LFPR Rate (ths.) population (ths.) South Dakota 69.6 430 67.1 16 3.6 Colorado 68.1 2,583 63.6 183 6.6 Idaho 64.0 724 59.8 51 6.5 Iowa 69.8 1,600 66.6 78 4.7 Minnesota 70.1 2,815 66.6 145 4.9 Nebraska 72.3 988 69.4 42 4.1 North Dakota 72.9 397 70.8 12 2.9 Wisconsin 68.6 2,884 63.9 208 6.7 United States 63.2 146,305 93.8 9,617 6.2 Source: Bureau of Labor Statistics
The unemployment rate in the Sioux Falls MSA was 3.1 percent in December 2014, the most recent data available, representing roughly 4,000 unemployed individuals; nationally the unemployment rate was 5.6 percent. A tight labor market with a limited pool of available, qualified workers presents challenges for employers looking to grow their companies. A low number of applicants was the top competitive challenge cited by employers throughout input. When asked to rate their reasons for hiring difficulties, 38.1 percent reported that a low number of applicants was always the reason they had difficulty filling positions, while another 31.9 percent reported that it was often the case. One employer succinctly said, “Just not enough people.”
Due to the tight labor market, employers reported that they have been forced to compromise their hiring standards, noting that a lack of workforce quantity has affected employee quality. Employers stated that they have had to hire people that were “unemployable” out of desperation, despite the fact that the applicant may have a poor work ethic, unstable work history, or is not fully qualified. When asked what actions the respondent’s company had taken in response to hiring difficulties, 59.5 percent reported that
Page 22 – April 2015 Workforce Sustainability Analysis they hired a less qualified person, while 65.3 percent said that they did not fill the job opening. Employers also reported that qualified workers were being “poached” by other companies in the Sioux Falls region.
FIGURE 9: EMPLOYMENT AND LABOR FORCE, US AND SIOUX FALLS MSA (INDEXED JAN 2000=100)
Source: Bureau of Labor Statistics
Data supports employers’ concerns regarding the quantity of available workers. As seen in Figure 9, the labor force and employment level indexed to January 20003 in the Sioux Falls metro illustrates just how tight the labor market is. The growth in Sioux Falls MSA employment is limited to the growth of its labor force. With the unemployment rate so low, there is only so much room to grow. Even with a healthy economy, there will always be some level of unemployment as individuals switch jobs, enter the labor market, or leave the labor force. Adding more pressure to the tight labor market, 78 percent of survey respondents reported that it was likely or highly likely that their business will add employees in the Sioux Falls area over the next five years.
In a positive sign, the greater Sioux Falls labor force has continued to increase, while the U.S. labor force has changed very little in the past five years. The large gap between the employment level and the labor force at the national level represents the recessionary years, the loss of jobs, and the increase in the amount of unemployed workers; the US unemployment rate peaked in October 2009 at 10 percent. Between 2008 and 2013, the labor force in the United States increased by 0.7 percent; in the Sioux Falls MSA it increased by 4.0 percent. Meanwhile, employment in the MSA increased by 3.4 percent and fell nationally by 1.0 percent.
3 January 2000 was chosen to illustrate how the labor force and employment level has changed over the past 15 years. For historical context, the unemployment rate in Sioux Falls at that time was 2.6 percent and 4.0 percent nationally.
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As seen in the following table, Greater Sioux Falls added approximately 10,000 jobs between 2009 and 2014, with health care and social assistance accounting for roughly 25 percent of the job growth. Health care continues to be a strong sector in the Sioux Falls MSA economy, with 16.8 percent of jobs in this sector in 2014. Health care is also the only sector that has an advantageous wage ratio from the employee perspective with earnings roughly 12 percent higher than the national average.
FIGURE 10: BUSINESS SECTOR OVERVIEW, SIOUX FALLS MSA4 Share of U.S. 2009 2014 Net Chg. Pct. Chg. US Pct. Chg. 2014 LQ Chg. Total Earnings Jobs Jobs (09-14) (09-14) (09-14) LQ (09-14) Jobs AAW Ratio Agriculture, Forestry, Fishing & Hunting 1,680 1,765 1.1% 85 5.1% 1.6% 0.93 0.01 $30,508 0.97 Mining, Quarrying, & Oil & Gas Extraction 88 59 0.0% (29) -33.0% 33.1% 0.07 (0.06) $38,416 0.40 Utilities 318 320 0.2% 20.6%-1.7% 0.57 0.00 $87,772 0.94 Construction 8,755 8,874 5.7% 119 1.4% -3.8% 1.11 0.04 $43,710 0.92 Manufacturing 12,370 13,465 8.7% 1,095 8.9% 2.6% 1.07 0.04 $44,280 0.72 Wholesale Trade 6,800 7,653 4.9% 853 12.5% 4.7% 1.26 0.07 $58,059 0.86 Retail Trade 16,886 18,658 12.0% 1,772 10.5% 4.6% 1.15 0.04 $27,050 0.96 Transportation & Warehousing 5,190 4,949 3.2% (241) -4.6% 8.8% 0.97 (0.16) $42,178 0.88 Information 3,109 2,799 1.8% (310) -10.0% -3.0% 0.96 (0.10) $50,335 0.62 Finance & Insurance 15,580 15,463 10.0% (117) -0.8% 2.4% 2.46 (0.12) $53,671 0.60 Real Estate & Rental & Leasing 1,822 1,796 1.2% (26) -1.4% -1.3% 0.70 (0.02) $37,667 0.82 Professional, Scientific, & Technical Services 5,241 5,746 3.7% 505 9.6% 9.7% 0.59 (0.01) $55,882 0.72 Management of Companies & Enterprises 1,437 1,963 1.3% 526 36.6% 14.6% 0.91 0.13 $88,189 0.79 Admin. & Support & Waste Mgmt. & Remed. Svcs. 5,253 6,680 4.3% 1,427 27.2% 18.4% 0.69 0.04 $29,110 0.87 Educational Services (Private) 3,357 3,468 2.2% 111 3.3% 10.4% 0.88 (0.08) $24,275 0.64 Health Care & Social Assistance 23,650 26,129 16.8% 2,479 10.5% 11.5% 1.36 (0.03) $50,336 1.12 Arts, Entertainment, & Recreation 2,620 2,728 1.8% 108 4.1% 7.7% 1.07 (0.05) $16,882 0.57 Accommodation & Food Services 10,588 11,528 7.4% 940 8.9% 12.2% 0.90 (0.04) $14,854 0.81 Other Services (except Public Administration) 6,162 6,432 4.1% 270 4.4% -1.9% 0.87 0.04 $24,422 0.93 Government 14,121 14,912 9.6% 791 5.6% -1.8% 0.61 0.03 $41,674 0.86 Total, all sectors 145,027 155,387 10,360 7.1% 5.2% $40,856 0.84 Source: EMSI
Jobs in finance and insurance decreased between 2009 and 2014, although employment within this sector is nearly back to its 2009 level. Companies in finance and insurance remain a strong presence in the local economy. In fact, out of the 374 MSAs across the country, metro Sioux Falls has the fourth highest concentration of jobs in finance and insurance. Earnings are comparatively lower than the national average due to differences in the local occupational mix. Sioux Falls area jobs within this sector employ a large number of comparatively lower-paying categories like customer service representatives, bookkeeping clerks, and insurance agents.
4 Note: “Earnings ratio” refers to the ratio of local earnings to the national average for that same sector. This helps provide an important perspective on the relative cost of labor in a community. “AAW” is the average annual wage. “LQ” refers to location quotient where an LQ equal to 1.0 possess exactly the same share of total local employment as it does of national employment within that sector. The color coding next to the LQ value illustrates the concentration of each sector relation to the nation’s where an LQ less than 0.95 is represented by red as having a smaller share of employment within that sector, yellow (0.95
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Seen in Figure 11, the top 20 largest occupations highlight the types of jobs that are most prevalent in the greater Sioux Falls economy. Topping the list are registered nurses, a highly concentrated occupation with a location quotient of nearly twice that of the nation. Jobs for registered nurses have grown quickly over the past five years (22.5 percent, ahead of the national figure). However, earnings are approximately 80 percent of the national average hourly wage.
There is also a high concentration of customer service representatives in the local economy due in part to a large presence of finance and insurance companies and back-office operations. Wells Fargo, Citibank, Capital One, Esurance, and First PREMIER Bank are top employers in the Sioux Falls metro and together supply over 8,000 jobs to local workers. Customer service representative jobs are typically filled by a younger workforce and have lower education requirement compared to other occupations. The average wage is roughly $13 an hour, 18 percent less than the nation.
The remaining top occupations represent a variety of business sectors, with several occupations such as bill and account clerks, bookkeeping clerks, and secretaries supporting companies in multiple areas, including manufacturing and education. As will be seen in this report’s Appendix, occupational strengths are strongly linked to employment sector concentrations, including industries pursued as targets by the region’s economic developers.
Earnings are nearly all equal to or lower than national average. Elementary school teachers had the least attractive earnings ratio with average earnings 25 percent less than the nation’s. In fact, teacher salaries in South Dakota rank 51st nationally, including the District of Columbia. Low salaries were reported to heighten the difficulty of attracting and retaining quality K-12 faculty. Administrators report that candidates living in greater Sioux Falls often cross into neighboring states to obtain teacher positions, which pay thousands of dollars more per year than in South Dakota.
According to recent news report, tax increases to support higher teacher pay are not likely at the state level. A local funding mechanism known as an "opt-out" allows districts to raise local taxes higher than South Dakota's per-student funding cap, which is set by lawmakers. The Sioux Falls School District has a $7.5 million annual opt-out, which has helped provide more funding for things such as teacher salaries. Opt-outs require two-thirds approval from a school board before being put before voters. Even if passed, opt-outs are temporary and require a sunset. In an ominous sign for South Dakota K-12 districts, even with almost half of every district in South Dakota spending millions of dollars more than the state-approved K- 12 funding levels, there still are pervasive reports of unfilled openings and dwindling candidate pools.5
5 Anderson, Patrick. Teacher shortage: Boosting pay depends on taxes. Argus Leader, 1/25/15
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FIGURE 11: TOP 20 LARGEST OCCUPATIONS Average U.S. 2014 09-14 09-14 2014 Description Hourly Earnings Education Level Jobs # Chg. % Chg. LQ Earnings Ratio Registered Nurses 5,511 1,011 22.5% 1.98 $25.90 0.78 Associate's degree Customer Service Representatives 4,442 218 5.2% 1.75 $13.11 0.82 High school diploma or equivalent Bookkeeping, Accounting, & Auditing Clerks 2,966 219 8.0% 1.61 $14.87 0.83 High school diploma or equivalent Heavy & Tractor-Trailer Truck Drivers 2,850 (110) -3.7% 1.52 $18.73 0.97 Postsecondary non-degree award Sales Representatives, Wholesale & Manufacturing* 2,197 242 12.4% 1.43 $27.54 0.90 High school diploma or equivalent Bill & Account Collectors 2,131 (96) -4.3% 5.51 $14.45 0.87 High school diploma or equivalent Nursing Assistants 2,077 127 6.5% 1.37 $12.13 0.97 Postsecondary non-degree award Secretaries & Administrative Assistants** 1,940 99 5.4% 0.72 $13.26 0.81 High school diploma or equivalent Receptionists & Information Clerks 1,809 100 5.9% 1.69 $12.21 0.92 High school diploma or equivalent Childcare Workers 1,802 (225) -11.1% 1.37 $8.61 0.98 High school diploma or equivalent Office Clerks, General 1,795 16 0.9% 0.54 $11.46 0.79 High school diploma or equivalent Accountants & Auditors 1,625 116 7.7% 1.18 $29.98 0.88 Bachelor's degree Insurance Sales Agents 1,616 357 28.4% 2.14 $27.49 0.94 High school diploma or equivalent General & Operations Managers 1,420 61 4.5% 0.67 $59.45 1.07 Bachelor's degree Team Assemblers 1,312 233 21.6% 1.16 $12.09 0.82 High school diploma or equivalent Carpenters 1,264 22 1.8% 1.22 $16.57 0.89 High school diploma or equivalent First-Line Supervisors of Retail Sales Workers 1,203 78 6.9% 0.81 $18.80 1.01 High school diploma or equivalent Farmers, Ranchers, & Other Agricultural Managers 1,146 (53) -4.4% 2.28 $13.54 0.98 High school diploma or equivalent Elementary School Teachers, Except Special Education 987 52 5.6% 0.72 $20.27 0.75 Bachelor's degree Residential Advisors 953 119 14.3% 8.22 $11.69 0.91 High school diploma or equivalent
* Except Technical & Scientific Products ** Except Legal, Medical, & Executive *** Except Special & Career/Technical Education Source: EMSI Note: Occupations that required less than a high school degree were not included.
The following table (Figure 12) shows that several fast-growing Sioux Falls area occupations over the past five years account for a larger share of jobs than the national level. The fastest growing occupations are mainly concentrated in the sectors of manufacturing and health care and social assistance and most often do not require formal post-secondary education. This is likely a contributor to the impacted labor pool for these lower-paying occupations that will be described later in this report.
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FIGURE 12: TOP 20 FASTEST GROWING OCCUPATIONS Average U.S. 2014 09-14 09-14 % Description 2014 LQ Hourly Earnings Education Level Jobs # Chg. Chg. Earnings Ratio Welding, Soldering, & Brazing Machine Setters* 78 27 52.9% 1.39 $16.42 0.96 High school diploma or equivalent Tool &Die Makers 93 32 52.5% 1.12 $21.55 0.91 High school diploma or equivalent Computer, Automated Teller, & Office Machine Repairers 123 36 41.4% 0.84 $16.87 0.97 Some college, no degree Welders, Cutters, Solderers, & Brazers 758 214 39.3% 1.90 $16.55 0.89 High school diploma or equivalent Security & Fire Alarm Systems Installers 78 22 39.3% 1.25 $18.40 0.88 High school diploma or equivalent Machinists 236 65 38.0% 0.57 $17.52 0.89 High school diploma or equivalent Computer-Controlled Machine Tool Operators^ 67 18 36.7% 0.45 $18.07 1.01 High school diploma or equivalent Coating, Painting, & Spraying Machine Setters* 294 77 35.5% 3.20 $13.08 0.85 High school diploma or equivalent Electrical & Electronic Equipment Assemblers 348 89 34.4% 1.68 $12.92 0.86 High school diploma or equivalent Diagnostic Medical Sonographers 159 40 33.6% 2.57 $26.15 0.81 Associate's degree Medical Equipment Repairers 69 17 32.7% 1.60 $24.56 1.10 Associate's degree Molding, Coremaking, & Casting Machine Setters *^ 249 59 31.1% 1.94 $14.61 1.00 High school diploma or equivalent Extruding & Drawing Machine Setters *^ 167 39 30.5% 2.21 $12.51 0.78 High school diploma or equivalent Electrical Power-Line Installers & Repairers 112 26 30.2% 0.96 $33.40 1.10 High school diploma or equivalent Cutting, Punching, & Press Machine Setters *^ 247 56 29.3% 1.27 $14.73 0.97 High school diploma or equivalent Surgical Technologists 235 53 29.1% 2.28 $18.28 0.85 Postsecondary non-degree award Producers & Directors 98 22 28.9% 0.84 $23.95 0.61 Bachelor's degree Insurance Sales Agents 1,616 357 28.4% 2.14 $27.49 0.94 High school diploma or equivalent Substance Abuse & Behavioral Disorder Counselors 196 42 27.3% 2.04 $16.92 0.86 High school diploma or equivalent Reservation & Transportation Ticket Agents & Travel Clerks 141 30 27.0% 0.96 $12.68 0.76 High school diploma or equivalent
* Operators, & Tenders ^ Metal and Plastic Source: EMSI Note: Occupations with fewer than 50 jobs and/or required less than a high school degree were not included.
Medical equipment repairers, which are connected to the health care sector, have grown rapidly over the past five years, with 33 percent more jobs than in 2009. Also indicative of the strong demand for these workers is the earnings ratio, which suggests upward pressures have been placed on wages within this line of work in an effort to recruit or retain qualified employees.
During the five-year period analyzed, jobs for welders increased by 39.3 percent in the metro area compared to 9.7 percent nationally. Welders predominantly work in the manufacturing sector, which has performed well since 2009 with growth accounting for over 1,000 jobs. Welding occupations have been the center of national focus in recent years due to the occupation’s aging workforce and impending retirements. It is an issue that has been on the radar of most local workforce agencies in South Dakota and in communities around the United States. A new state-level program, Build Dakota, will seek to address shortages in welding talent as well as other impacted occupations. The program will be described more fully later in this report. In fact, all four technical institutes in South Dakota have welding programs. “The issue,” according to Southeast Technical Institute’s president Jeff Holcomb, “is we couldn't turn out enough of them to fill the need even if we quadrupled the space in our programs." In addition to welders, Holcomb says companies desperately need mechatronics technicians and mechanical engineering technicians.6
Figure 13 highlights the Sioux Falls region’s top 20 fastest declining occupations. Reasons for the decline in each occupation vary and must be taken into context. For example, some occupations were negatively affected by the recession to a larger degree than others. Jobs such as architects, architectural and civil drafters, brickmasons and blockmasons, and securities, commodities, and financial services sales agents
6 Young, Steve. Is welding really a career worth pursuing? Argus Leader, 1/30/15
Page 27 – April 2015 Workforce Sustainability Analysis were all causalities likely brought on by the downturn. On the other hand, the decline observed in photographers, tellers, gaming change persons and booth cashiers, couriers and messengers, and door-to- door sales workers likely tells a different story. Some of the jobs in these areas are less likely to rebound over the next ten years due to technological advancements and changes in consumer preferences. It is interesting to note that the majority of greater Sioux Falls’ fastest declining occupations require a bachelor’s degree or above for employment, while its fastest growing require just a high school diploma or, on occasion, a certificate or associate’s degree. This again supports trends the region is observing in lower-paying, lower-skill jobs wanting for hirable candidates while some in the workforce with higher-level degrees are underemployed.
FIGURE 13: FASTEST DECLINING OCCUPATIONS
Average U.S. 2014 09-14 # 09-14 2014 Description Hourly Earnings Education Level Jobs Chg. % Chg. LQ Earnings Ratio
Photographers 93 (42) -31.1% 0.70 $12.83 0.85 High school diploma or equivalent Door-to-Door Sales Workers, News & Street Vendors^ 70 (30) -30.0% 0.82 $12.42 1.27 High school diploma or equivalent Architects, Except Landscape &Naval 52 (21) -28.8% 0.45 $34.70 0.99 Bachelor's degree Personal Financial Advisors 125 (40) -24.2% 0.53 $32.27 0.72 Bachelor's degree Massage Therapists 68 (16) -19.0% 0.44 $15.16 0.94 Postsecondary non-degree award Brickmasons & Blockmasons 141 (32) -18.5% 1.87 $21.34 0.94 High school diploma or equivalent Reporters & Correspondents 51 (11) -17.7% 1.01 $15.88 0.77 Bachelor's degree Couriers & Messengers 66 (14) -17.5% 0.62 $12.37 0.92 High school diploma or equivalent Installation, Maintenance, & Repair Workers, All Other 62 (13) -17.3% 0.38 $19.22 1.04 High school diploma or equivalent Construction Managers 220 (44) -16.7% 0.58 $29.54 0.88 Bachelor's degree Software Developers, Systems Software 148 (29) -16.4% 0.37 $39.89 0.80 Bachelor's degree Architectural & Civil Drafters 116 (20) -14.7% 1.17 $18.90 0.77 Associate's degree Medical Secretaries 97 (16) -14.2% 0.18 $17.86 1.12 High school diploma or equivalent Dentists, General 112 (18) -13.8% 0.83 $86.65 1.10 Doctoral or professional degree Securities, Commodities, & Financial Services Sales Agents 254 (40) -13.6% 0.70 $62.85 1.32 Bachelor's degree Electronics Engineers, Except Computer 64 (10) -13.5% 0.45 $37.51 0.80 Bachelor's degree Electrical &Electronics Engineering Technicians 53 (8) -13.1% 0.36 $23.69 0.84 Associate's degree Tellers 740 (109) -12.8% 1.40 $11.22 0.89 High school diploma or equivalent Gaming Change Persons & Booth Cashiers 59 (8) -11.9% 2.84 $13.49 1.12 High school diploma or equivalent Telecommunications Equipment Installers & Repairers* 229 (31) -11.9% 1.01 $24.44 0.95 Postsecondary non-degree award
* Except Line Installers ^ And related workers Source: EMSI Note: Occupations with fewer than 50 jobs and/or required less than a high school degree were not included.
As previously mentioned, the location quotient is a measure of how concentrated an occupation or business sector is in the local economy compared to the national level. Figure 14 lists the top 20 most concentrated occupations in the Sioux Falls MSA. Topping the list are correspondence clerks, jobs whose primary duties include composing letters or electronic correspondence in reply to requests for damage claims, credit, delinquent accounts, and incorrect billings, among others. These jobs mainly fall within the business activities covered by the finance and insurance sector. There is also a high concentration of residential advisors., which can be attributed to the presence of mental health facilities, community housing, and group homes.
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FIGURE 14: TOP 20 MOST CONCENTRATED OCCUPATIONS Average U.S. 2014 09-14 # 09-14 Description 2014 LQ Hourly Earnings Education Level Jobs Chg. % Chg. Earnings Ratio Correspondence Clerks 163 14 9.4% 19.55 $13.72 0.79 High school diploma or equivalent Residential Advisors 953 119 14.3% 8.22 $11.69 0.91 High school diploma or equivalent Bill and Account Collectors 2,131 (96) -4.3% 5.51 $14.45 0.87 High school diploma or equivalent Floor Layers, Except Carpet, Wood, and Hard Tiles 111 17 18.1% 5.01 $16.42 1.01 High school diploma or equivalent Nuclear Medicine Technologists 97 19 24.4% 4.69 $25.61 0.74 Associate's degree Loan Interviewers and Clerks 861 (31) -3.5% 3.93 $15.39 0.86 High school diploma or equivalent Broadcast Technicians 115 18 18.6% 3.85 $13.79 0.69 Associate's degree Cabinetmakers and Bench Carpenters 387 29 8.1% 3.84 $14.46 0.93 High school diploma or equivalent Credit Authorizers, Checkers, and Clerks 192 (23) -10.7% 3.78 $13.81 0.81 High school diploma or equivalent Nurse Anesthetists 138 15 12.2% 3.64 $80.77 1.06 Master's degree Credit Analysts 241 (16) -6.2% 3.55 $30.46 0.87 Bachelor's degree Extruding, Forming, Pressing, and Compacting Machine Setters* 254 33 14.9% 3.51 $15.36 0.96 High school diploma or equivalent Merchandise Displayers and Window Trimmers 264 34 14.8% 3.29 $10.35 0.73 High school diploma or equivalent Electrical and Electronics Repairers* 229 23 11.2% 3.24 $18.61 0.71 Postsecondary non-degree award Coating, Painting, and Spraying Machine Setters^ 294 77 35.5% 3.20 $13.08 0.85 High school diploma or equivalent Insurance Claims and Policy Processing Clerks 781 111 16.6% 3.13 $14.37 0.79 High school diploma or equivalent Medical Transcriptionists 256 25 10.8% 3.13 $15.21 0.93 Postsecondary non-degree award Gaming Change Persons and Booth Cashiers 59 (8) -11.9% 2.84 $13.49 1.12 High school diploma or equivalent Crushing, Grinding, and Polishing Machine Setters^ 88 8 10.0% 2.78 $11.20 0.68 High school diploma or equivalent Surgeons 132 7 5.6% 2.73 $107.88 1.00 Doctoral or professional degree
* Commercial and Insutrail Equipment ^ Operators, and Tenders Source: EMSI Note: Occupations with fewer than 50 jobs in 2014 and/or required less than a high school degree were not included.
KEY FINDINGS South Dakota and metro Sioux Falls continue to experience high labor force participation and low unemployment, a situation that has led to a tight labor market and dearth of available candidates for many job openings. In greater Sioux Falls, this has led to employers reportedly hiring under-qualified applicants and “poaching” from other local businesses.
Healthcare and social assistance jobs accounted for the highest rate (25 percent) of employment growth from 2009 to 2014. Finance and insurance jobs declined during this period, but are almost back to 2009 levels.
The most prevalent occupations in the Sioux Falls area are registered nurses, customer service representatives, and bookkeeping, accounting, and auditing clerks. Most of the region’s largest occupational categories do not require four-year degrees for eligibility.
Fastest growing occupations include health care and social assistance and manufacturing, especially welders. Interestingly, many of the region’s fastest-declining occupations require a bachelor’s degree or above.
The majority of the Sioux Falls area’s most concentrated (by LQ) occupations, including correspondence clerks, residential advisors, and bill and account collectors, only require a high school diploma or equivalent for employment. Overall, data clearly show that the Sioux Falls MSA economy is strongly focused on lower-skill, lower-paying jobs.
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What issues are our employers facing today in terms of workforce availability? Employers discussed several issues and frustrations throughout input, from the quantity of candidates to the quality of workers. Many of the challenges cited were similar to those identified during the Accenture- facilitated Workforce Summits in 2014 and the 2009 Future Sioux Falls process. These include difficulty in finding qualified workers, training capacity issues, and the lack of early exposure in schools to career fields.
Survey participants for the Action Agenda process were asked to rank a list of possible reasons that have affected their ability to hire quality candidates. As seen in Figure 15, top answers included a low number of applicants, lack of relevant work experience, and lack of technical or occupational skills.
FIGURE 15: PLEASE RATE THE FOLLOWING POSSIBLE REASONS THAT HAVE CAUSED HIRING DIFFICULTIES BASED ON THE FREQUENCY THAT EACH REASON HAS PLAYED A PART IN FINDING INDIVIDUALS TO FILL POSITIONS WITH YOUR COMPANY
Source: 2015 Sioux Falls Strategic Workforce Action Agenda Survey; Market Street Services. Question was presented to 116 individuals that self-identified as owners, executives, managers, or human resources staff.
These survey findings are consistent with interview and focus group impact and are borne out by trends seen in employment, occupational, and workforce data. Sioux Falls area companies are faced with
Page 30 – April 2015 Workforce Sustainability Analysis growing demand for workers but a shrinking pool of candidates, especially for lower-wage, lower- skill positions. As will be discussed later in this report, the region’s capacity to produce local graduates to meet this demand is constrained by the lack of a stand-alone four-year university campus and structural factors related to the technical college system. Also, pervasive attitudes diminishing the value of career and technical education and pursuit of employment in the skilled trades are key factors limiting the number of potential workers that pursue these fields.
Indeed, the theme of constrained labor supply emerged often through input. Participants said that external perception of South Dakota as frozen prairie adversely impacted talent attraction, though candidates were “won over” by greater Sioux Falls when experiencing the region in person. One employer reported that the company “would have had to leave South Dakota if it hadn’t been for the refugee population.” They felt that the area’s concentration “should be on recruiting people, not companies.” Several focus group participants and interviewees felt that the area needs to change its “brand” and increase talent-marketing efforts.
Others noted that low average wages are a challenge for retaining graduates or recruiting external talent. Many tried to convey that the lack of state income tax and generous benefits packages compensate for lower wages, but acknowledged that this was often a hard sell for prospective talent. Even so, young professional workers did note that concerted efforts to communicate the value of benefits versus higher salary were effective when pursued proactively and honestly.
Survey respondents were asked about actions their company or organization had taken in response to hiring difficulties. As displayed in Figure 16, one of the top responses was increased wage or benefits packages. Increases in the Sioux Falls area’s average annual wages would seem to support the fact that employers are raising compensation packages to better attract and retain talent. Other top responses included more aggressive internal and external recruiting efforts, hiring of less qualified workers, paying more overtime, leaving positions unfilled, and training candidates in-house. It is interesting that greater Sioux Falls is simultaneously experiencing underemployment among over-educated workers as well as employers reportedly hiring underqualified candidates. Talent absorption to fill a preponderance of need in lower-skill positions has evidently led to educated workers setting for lower-paying positions because jobs in their preferred fields are not available in addition to employers hiring sub-optimal candidates due to the basic need to fill the position.
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FIGURE 16: PLEASE CHECK ALL THE ACTIONS THAT YOUR COMPANY OR ORGANIZATION HAS TAKEN IN RESPONSE TO HIRING DIFFICULTIES.
Source: 2015 Sioux Falls Workforce Action Agenda survey; Market Street Services
Generational differences within the workplace were also often cited as a challenge throughout input. The growing presence of Millennials (those born between 1981 and 1995) in the workplace is creating challenges as managers try to adjust to new worker attitudes and preferences. In fact, this is the first time in history where five generations of employees are working together. Between 2008 and 2013, the number of residents in the Sioux Falls area from the Millennial generation increased by 11.8 percent, outpacing growth of the Baby Boomer generation, which increased by 0.7 percent. Employers in input were frustrated by what they perceived as an entitlement attitude among Millennials and a lack of work ethic. Many felt they were “shooting in the dark” trying to figure out how to attract and manage them. For their part, young professionals spoke of the need for work-life balance and a desire to work “smarter” instead of “longer.” They appreciated efforts made by employers to make the workplace a more fun and engaging environment.
Survey respondents were asked to rank the effectiveness of certain programs and services used to find or provide qualified employees. Approximately half of survey respondents reported that the most effective option to source qualified workers was employee referral or word of mouth. One company official noted, “Employee referrals are by far the most successful recruiting and retention opportunities.” Staffing firms and third-party recruiters were ranked as the least effective services for sourcing qualified
Page 32 – April 2015 Workforce Sustainability Analysis workers. Internships, including Dakota Seeds, and local higher education institutions were also cited as beneficial.
Finally, employers participating in the online survey were asked to report the top three most difficult jobs to fill at their companies. Figure 17 displays participants’ answers; word size is based on the frequency of use of that term in the survey responses. Their replies echoed the input heard from interviewees, focus groups, and other stakeholders that lower-paying positions often requiring little formal education were some of the hardest jobs to fill. Higher-skill categories such as engineer, IT, and software were referenced, but not to the degree as lower-skilled positions.
FIGURE 17: SPECIFICALLY, WHAT ARE THE TOP THREE MOST DIFFICULT JOBS TO FILL AT YOUR COMPANY?
Source: 2015 Sioux Falls Strategic Workforce Action Agenda Survey; Market Street Services
Supplementing qualitative data with the quantitative data provides context for determining which occupations are most in demand by regional employers. Figure 18 provides an overview of the major occupational groups and their composition in the Sioux Falls area. Historical trends illustrate changes in the occupational composition of the local labor market. Office and administrative support positions account for the largest percentage of jobs in the Sioux Falls area, followed by sales and related occupations. As indicated by the location quotient (LQ), 14 occupational groups have increased in concentration in the local economy, albeit small increases, with the exception of healthcare practitioners.
Due to the large number of employers involved in health care, fast growth rates and high concentrations were found in healthcare practitioners and technical occupations. Although the health care and social assistance business sector as a whole averaged higher than average wages, healthcare practitioners and technical occupations average lower wages compared to the nation. In fact, wages for all occupations except two (Farming, fishing, and forestry and Military) were lower than the U.S. average, oftentimes much
Page 33 – April 2015 Workforce Sustainability Analysis lower. Clearly, low wage rates are not just the perception of employees but the reality of the Sioux Falls area economy.
FIGURE 18: OCCUPATIONAL OVERVIEW
US % Jobs: Openings Avg. US # Chg. % Chg. LQ Chg. 2009 Jobs 2014 Jobs Chg. Share of : Share of 2014 LQ Annual Earnings (09-14) (09-14) (09-14) Description (09-14) Total Total Earnings Ratio** Management 6,209 6,244 35 0.6% 3.4% 4.0% 3.2% 0.76 (0.04) $85,872 0.87 Business and Financial Operations 7,397 7,789 392 5.3% 6.2% 5.0% 4.7% 1.03 (0.03) $58,745 0.84 Computer and Mathematical 3,268 3,588 320 9.8% 11.5% 2.3% 2.1% 0.88 (0.03) $59,004 0.73 Architecture and Engineering 1,405 1,362 (43) -3.1% 4.6% 0.9% 0.8% 0.53 (0.05) $60,839 0.77 Life, Physical, and Social Science 762 873 111 14.5% 5.3% 0.6% 0.7% 0.68 0.04 $62,098 0.90 Community and Social Service 2,202 2,424 222 10.1% 6.7% 1.6% 1.7% 0.97 0.01 $38,825 0.87 Legal 860 900 39 4.6% 1.8% 0.6% 0.5% 0.69 0.01 $74,403 0.78 Education, Training, and Library 5,617 5,907 290 5.2% 1.3% 3.8% 3.4% 0.66 0.01 $38,867 0.77 Arts, Design, Entertainment, Sports, and Media 2,512 2,752 240 9.5% 3.9% 1.8% 2.1% 1.02 0.03 $35,309 0.71 Healthcare Practitioners and Technical 10,561 12,348 1,787 16.9% 7.0% 7.9% 8.8% 1.48 0.10 $65,151 0.86 Healthcare Support 3,620 3,791 170 4.7% 10.6% 2.4% 2.1% 0.87 (0.07) $27,372 0.98 Protective Service 1,880 2,047 168 8.9% 2.0% 1.3% 1.3% 0.59 0.03 $40,645 0.94 Food Preparation and Serving Related 11,849 12,848 999 8.4% 11.6% 8.3% 9.7% 1.01 (0.05) $19,854 0.92 Building and Grounds Cleaning and Maintenance 5,255 5,919 664 12.6% 4.4% 3.8% 3.8% 0.99 0.06 $23,326 0.94 Personal Care and Service 5,904 5,899 (5) -0.1% 7.6% 3.8% 4.5% 0.98 (0.09) $22,803 0.99 Sales and Related 17,006 18,475 1,469 8.6% 3.6% 11.9% 13.2% 1.14 0.03 $37,883 0.98 Office and Administrative Support 25,688 26,487 799 3.1% 3.7% 17.0% 13.9% 1.11 (0.03) $29,269 0.84 Farming, Fishing, and Forestry 454 567 113 24.8% 6.0% 0.4% 0.6% 0.49 0.07 $28,552 1.20 Construction and Extraction 7,266 7,507 241 3.3% -1.7% 4.8% 4.5% 1.10 0.03 $36,171 0.85 Installation, Maintenance, and Repair 5,210 5,701 491 9.4% 5.7% 3.7% 3.9% 0.97 0.02 $42,291 0.98 Production 8,646 9,811 1,165 13.5% 6.1% 6.3% 7.3% 1.05 0.05 $30,280 0.87 Transportation and Material Moving 10,002 10,612 610 6.1% 8.3% 6.8% 6.2% 1.06 (0.04) $31,016 0.92 Military 1,456 1,537 81 5.6% -1.4% 1.0% 0.8% 0.73 0.04 $39,233 1.13 145,029 155,387 10,358 7.1% 5.2% $38,881 0.86 *Average annual earnings calculated by multiplying the average hourly wage by 2080, the standard hours worked in a year. **Sioux Falls average hourly earnings divided by the US average hourly earnings. A ratio greater than 1 indicates that workers in Sioux Falls earn more hourly. Source: EMSI
The “openings” column represents jobs that were available over the five-year period and can be used to identify occupations in demand by employers. The number of openings stems from job growth, replacements, and retirees; the share of total openings by occupational group helps to identify where the largest needs have been for qualified workers.
Office and administrative and sales and related occupations – both fast-growing and large categories – account for a significant percentage of total job openings. Food preparation and serving related occupations accounted for 9.7 percent of openings. Replacement needs occurring when a job is vacated permanently are typically seen at lower skilled jobs. Often those workers will switch occupations to a more skilled position after acquiring additional training or education.
Figure 19 lists the occupations with the largest number of openings over the past five years. Declining occupations (such as team assemblers) with high rates of openings are likely characterized by demand driven by retirements and resulting replacement needs. By comparison, growing occupational categories (such as registered nurses and customer service representatives) with high number of openings are more likely the result of pure employer demand and scarcity of available talent with those skills. Reflecting a consistent theme of this report, the occupations with the highest number of job openings are in fields that typically require less education and less intensive acquisition of hard-to- find skills.
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FIGURE 19: TOP 20 OCCUPATIONS BY OPENINGS 2009-2014
2014 # Chg. % Chg. US % Chg. Difference Description Openings Jobs (09-14) (09-14) (09-14) in Growth
Registered Nurses 5,511 1,011 1,554 22% 6% 16% Customer Service Representatives 4,442 218 978 5% 7% -2% Insurance Sales Agents 1,616 357 687 28% 24% 5% Bill and Account Collectors 2,131 (96) 498 -4% 4% -8% Sales Representatives, Wholesale and Manufacturing* 2,197 242 490 12% 4% 8% Accountants and Auditors 1,625 116 454 8% 6% 2% Childcare Workers 1,802 (225) 453 -11% -8% -3% Bookkeeping, Accounting, and Auditing Clerks 2,966 219 443 8% 6% 2% Residential Advisors 953 119 418 14% 10% 4% Nursing Assistants 2,077 127 412 7% 5% 2% Receptionists and Information Clerks 1,809 100 384 6% 6% 0% Heavy and Tractor-Trailer Truck Drivers 2,850 (110) 361 -4% 7% -11% Team Assemblers 1,312 233 352 22% 14% 8% Welders, Cutters, Solderers, and Brazers 758 214 341 39% 10% 30% Office Clerks, General 1,795 16 289 1% 4% -3% First-Line Supervisors of Retail Sales Workers 1,203 78 275 7% 2% 5% Secretaries and Administrative Assistants^ 1,940 99 275 5% 6% 0% Automotive Service Technicians and Mechanics 789 158 257 25% 8% 17% Hairdressers, Hairstylists, and Cosmetologists 681 92 239 16% 4% 11% Carpenters 1,264 22 234 2% -5% 7%
* Except Technical and Scientific Products ^ Except Legal, Medical, and Executive Source: EMSI
To provide additional perspective to the issue of labor supply versus demand, Market Street calculated ratios of unemployed workers versus job openings for the Sioux Falls area’s occupational categories as seen in Figure 20. In total, it was estimated that there were 6,000 to 7,000 job openings over the past year, in greater Sioux Falls and roughly 4,000 unemployed workers. The unemployed worker to job openings ratio was approximately 0.6, suggesting that there were roughly three unemployed individuals for every five job openings. For comparison, nationally in January 2015 there were 1.8 unemployed workers per opening. (At the end of the recession in June 2009, that figure in the U.S. was 6.2.) Thus, this data demonstrates the relative “tightness” of the labor market for each occupation.
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FIGURE 20: SHARE OF TOTAL UNEMPLOYED VERSUS JOB OPENINGS BY OCCUPATION
Share of Total Share of Total Sioux Falls United States Occupational Group Unemployed Job Openings ratio ratio
Architecture & Engineering 0.1% 0.8% 0.1 0.9 Farming, Fishing, & Forestry 0.1% 0.6% 0.1 2.1 Healthcare Practitioners & Technical 2.2% 8.9% 0.1 0.7 Life, Physical, & Social Science 0.2% 0.7% 0.1 0.8 Computer & Mathematical 0.7% 2.1% 0.2 0.7 Production 3.3% 7.4% 0.2 1.6 Installation, Maintenance, & Repair 1.8% 3.9% 0.2 1.0 Business & Financial Operations 2.8% 4.8% 0.3 1.1 Sales & Related 9.4% 13.3% 0.3 1.4 Food Preparation & Serving Related 6.9% 9.8% 0.3 0.9 Community & Social Service 1.3% 1.7% 0.4 1.0 Education, Training, & Library 2.6% 3.4% 0.4 1.2 Transportation & Material Moving 5.1% 6.2% 0.4 1.6 Personal Care & Service 4.0% 4.6% 0.4 1.4 Healthcare Support 1.9% 2.1% 0.4 1.4 Protective Service 1.3% 1.4% 0.5 1.0 Arts, Design, Entertainment, Sports, & Media 2.5% 2.2% 0.6 1.6 Office & Administrative Support 19.7% 14.1% 0.7 1.8 Management 4.6% 3.2% 0.7 1.9 Legal 0.9% 0.5% 0.8 1.8 Building & Grounds Cleaning & Maintenance 6.6% 3.8% 0.8 2.5 Construction & Extraction 9.2% 4.6% 1.0 2.3 Source: EMSI
Based on these data, healthcare and computer/mathematical occupations are currently the higher wage jobs experiencing the tightest labor markets in the Sioux Falls region and are thus priorities for education and training practitioners. It is natural to assume that the positions with the greatest educational requirements would have the fewest available unemployed workers, but the reported (and quantifiable) lack of talent for lower-skill positions in sales, administration, and other lower-paying jobs shows that, 1) there are still not enough qualified workers being developed or attracted in these fields, and 2) there are stronger opportunities to bring adults back to work with existing experience in these occupations. Overall, there is not a single occupational group with a surplus of workers, which again
Page 36 – April 2015 Workforce Sustainability Analysis illustrates the tightness of the Sioux Falls area labor force and the pressing need to grow the region’s supply of available workers.
KEY FINDINGS
There is a growing need for workers in the Sioux Falls area, but a shrinking pool of applicants, especially for lower-skill positions. Talent attraction is a challenge in the region due to perceptions of South Dakota’s lifestyles and lower wages across-the-board for metro Sioux Falls positions.
Employers in greater Sioux Falls are utilizing multiple tactics to cope with talent shortages, including increasing regional recruiting, rising salaries, hiring less qualified candidates, and even leaving hundreds of jobs unfilled. Generational workplace issues between management and Millennials are compounding employers’ perceptions that current staff lack the work ethic of past generations.
The principal occupational categories in the Sioux Falls MSA, led by office and administration and sales and related, nearly all pay less than their national equivalents.
Occupations with the highest number of job openings from 2009 to 2014, including registered nurse, customer service representatives, insurance agents, and bill collectors, all require less education than higher-paying positions.
Data show that the tightest labor markets in the Sioux Falls area are for health care and computer and mathematical jobs. There is not one major occupational category in the region that is experiencing a surplus of available workers.
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What can we expect in the next decade? A key expectation of this Workforce Sustainability Analysis report is the projection of future jobs and occupations in demand to not only inform the Action Agenda but give perspective to the education and training community on programs that might be critical to meeting employer needs. As the Great Recession showed, prediction of future economic conditions is not an exact science; the constantly changing dynamics of the global, national, and regional economies means that correctly assessing the sectors and jobs growing fastest should be taken with a grain of salt. This is especially true as technologies such as the Internet of Things and sub-atomic-scale production will alter the employment landscape in ways today’s thinkers cannot hope to fathom.
Therefore, while this report will present ten-year employment projections, the ultimate goal of the Action Agenda should be to formalize systems and partnerships that will enable the Sioux Falls area to flexibly and nimbly adjust to new job and skills requirements and demands before talent needs become impacted as they currently are in the region. Communicating with existing workers and rising graduates on the realities of the current and emerging marketplace will also be important to ensure they are aware of burgeoning opportunities and their associated training needs. (Note: This section does not break down occupations by Sioux Falls area target sectors; this will be done in the Appendix of this report.)
A 2013 Oxford University study7 presented a detailed analysis of occupations that are most susceptible to shrinkage caused by computerization and advancement in technology over the next 20 years and predicted that 47 percent of U.S. jobs are at risk, including many low-skill occupations. The authors found that a significant number of jobs in service occupations are the most susceptible to computerization. Less so are occupations that require advanced skills like social intelligence and creativity-based jobs. Management, business, and financial; computer, engineering, and science; education, legal, community service, arts, and media; and healthcare practitioners and technical occupations all have a smaller probability of being computerized. Occupations least likely to be replaced by technology include occupational therapists, elementary school teachers, recreational therapists, and mental health and substance abuse social workers. The authors concluded that, “For workers to win the race… they will have to acquire creative and social skills.”
Figure 21 provides a list of the top 20 occupations with the highest probability of automation, as well as the number and concentration of jobs in the Sioux Falls area that would potentially be affected. Note that this refers to the probability that this occupation can be computerized over the next two decades, and does not estimate the chance that all of the jobs will be eliminated. Eleven out of 20 occupations in the Sioux Falls MSA are at risk of obsolescence, amounting to just over 3,000 jobs. This is significant for the region in that, as has been noted, some of the area’s fastest-growing job categories are also most at risk of elimination due to technological advancement. If greater Sioux Falls had the same job concentrations as the national average, then roughly 2,400 jobs would be at risk, or approximately 40 percent fewer than the locally-based figure.
7 http://www.oxfordmartin.ox.ac.uk/downloads/academic/The_Future_of_Employment.pdf
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FIGURE 21: TOP 20 OCCUPATIONS MOST AT RISK OF AUTOMATION Sioux Falls 2014 2014 Occupation Probability Jobs LQ 1 Telemarketers 0.99 446 1.76 2 Title Examiners, Abstractors, and Searchers 0.99 95 1.49 3 Sewers, hand 0.99 <10 - 4 Mathematical Technicians 0.99 <10 - 5 Insurance Underwriters 0.99 241 2.51 6Watch Repairers 0.99 <10 - 7 Cargo and Freight Agents 0.99 167 2.14 8 Tax Preparers 0.99 66 0.65 9 Photographic Process Workers & Processing Machine Operators 0.99 39 1.06 10 New Accounts Clerks 0.99 18 0.31 11 Library Technicians 0.99 161 1.29 12 Data Entry Keyers 0.99 147 0.67 13 Timing Device Assemblers and Adjusters 0.98 <10 - 14 Insurance Claims and Policy Clerks 0.98 781 3.13 15 Brokerage Clerks 0.98 104 1.68 16 Order Clerks 0.98 100 0.48 17 Loan Officers 0.98 675 2.18 18 Insurance Appraisers, Auto Damage 0.98 19 1.30 19 Umpires, Referees, and Other Sports Officials 0.98 17 0.72 20 Tellers 0.98 740 1.40 Source: The Future of Employment: How Susceptible Are Jobs to Computerization? Note: The probability factor indicates the likelihood that the occupation can be computerized.
Figure 22 lists the top 20 occupations that are projected to decline the fastest nationally. Projections are done based on current and expected future conditions and under the assumption that the labor market is in equilibrium. Postal service is one of the largest sectors most negatively impacted by the advancements in technology. Door-to-door sales workers, news and street vendors, and related workers are casualties of both technological changes and consumer preferences as more people turn to online options for their news and purchasing choices.
Overall, the Sioux Falls area has a relatively small share of jobs in occupations that are projected to rapidly decline nationally. Although many of the jobs are in manufacturing, they are primarily concentrated in fabric mill operations which are not pervasive in the local economy. Several of the occupations have little to no employment in the Sioux Falls area; postal service mail sorters, postmasters, and farmers are the only occupations on the list that have a LQ greater than one in greater Sioux Falls.
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FIGURE 22: TOP 20 OCCUPATIONS WITH THE FASTEST PROJECTED NATIONAL DECLINE United States Sioux Falls 2014 2014 2014 Description # Chg. % Chg. Jobs Jobs LQ Textile Knitting & Weaving Machine Setters, Operators, & Tenders 22,162 (6,581) (30%) <10 0.02 Fallers 9,554 (2,764) (29%) <10 0.15 Locomotive Firers 1,986 (566) (28%) <10 0.47 Textile Bleaching & Dyeing Machine Operators & Tenders 11,920 (3,259) (27%) 00.00 Door-to-Door Sales Workers, News & Street Vendors, & Related Workers 84,699 (19,623) (23%) 70 0.82 Postal Service Clerks 69,134 (15,379) (22%) 42 0.59 Log Graders & Scalers 3,344 (740) (22%) <10 0.25 Shoe Machine Operators & Tenders 4,105 (904) (22%) 00.00 Postal Service Mail Sorters, Processors, & Processing Machine Operators 117,802 (25,516) (22%) 196 1.64 Shoe & Leather Workers & Repairers 8,084 (1,579) (20%) <10 0.24 Postal Service Mail Carriers 297,554 (53,591) (18%) 275 0.91 Paperhangers 4,609 (815) (18%) <10 0.64 Textile Cutting Machine Setters, Operators, & Tenders 14,969 (2,619) (17%) <10 0.29 Farmers, Ranchers, & Other Agricultural Managers 496,262 (86,076) (17%) 1,146 2.28 Sewing Machine Operators 153,565 (26,581) (17%) 61 0.39 Word Processors & Typists 105,524 (17,206) (16%) 91 0.85 Fabric Menders, Except Garment 754 (120) (16%) 00.03 Postmasters & Mail Superintendents 17,864 (2,693) (15%) 31 1.74 Data Entry Keyers 224,747 (33,531) (15%) 147 0.64 Textile Winding, Twisting, & Drawing Out Machine Setters, Operators, & Tenders 26,379 (3,749) (14%) <10 0.04 Source: EMSI
Conversely, Figure 23 shows national projections of the top growing occupations in the next ten years, many of which are concentrated in metro Sioux Falls’ target-driven occupations. Principal among these are health care jobs. Growth trends at the national level can have varying degrees of effect on local economies. The Sioux Falls area has a large share of diagnostic sonographers, a nationally and locally fast growing occupation. Employment is projected to grow by 34 percent in the United States, with the Sioux Falls area standing to experience similarly fast growth rates. Other occupations of strength in the Sioux Falls area projected to grow nationally are physician assistants and interpreters and translators. As a reminder, input noted that there is a great need for additional capacity to train licensed translators.
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FIGURE 23: TOP 20 OCCUPATIONS WITH THE FASTEST PROJECTED NATIONAL GROWTH United States Sioux Falls 2014 2014 Description 2014 Jobs # Chg. % Chg. Jobs LQ Interpreters and Translators 72,068 26,056 36% 124 1.70 Diagnostic Medical Sonographers 60,887 20,851 34% 159 2.57 Insulation Workers, Mechanical 31,235 10,641 34% 19 0.61 Home Health Aides 965,740 324,728 34% 137 0.14 Occupational Therapy Assistants 31,726 10,662 34% 21 0.65 Information Security Analysts 82,047 26,836 33% 49 0.59 Personal Care Aides 1,603,138 512,921 32% 570 0.35 Physical Therapist Assistants 74,962 23,835 32% 92 1.20 Genetic Counselors 2,488 791 32% <10 0.37 Physical Therapist Aides 50,331 15,671 31% 32 0.62 Audiologists 11,975 3,707 31% 18 1.45 Orthotists and Prosthetists 8,818 2,681 30% <10 0.72 Meeting, Convention, and Event Planners 90,821 27,257 30% 80 0.87 Medical Equipment Repairers 42,624 12,295 29% 69 1.60 Physician Assistants 94,088 26,987 29% 155 1.63 Market Research Analysts and Marketing Specialists 477,996 136,554 29% 287 0.59 Petroleum Engineers 39,085 11,134 28% <10 0.10 Skincare Specialists 53,533 15,131 28% 23 0.42 Occupational Therapy Aides 9,423 2,629 28% 10 1.08 Physical Therapists 211,812 57,954 27% 249 1.16 Source: EMSI
Market Street also looked at occupations with high percentages of workers over the age of 55 and, therefore, most susceptible to impending retirements in the Sioux Falls area. Figure 24 shows that nine out of 20 professions on this list require more than a high school degree; several are management- level positions where experience is necessary to fulfill job duties. Overall, the Sioux Falls region is not significantly impacted by the specter of future retirements. As has been mentioned, the region has a comparatively young workforce and features job concentrations in many service sector positions that are not as susceptible to age-related contraction. An exception is teachers, which have already been discussed as a critical occupational need in the Sioux Falls area.
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FIGURE 24: TOP 20 SIOUX FALLS AREA OCCUPATIONS MOST SUSPECIBLE TO RETIREMENTS 2014 Description % 55+ 2014 Jobs Typical Entry Level Education LQ Bus Drivers, School or Special Client 53.6% 267 0.54 High school diploma or equivalent Postal Service Mail Sorters^ 49.5% 196 1.64 High school diploma or equivalent Clergy 49.3% 282 1.17 Bachelor's degree Farmers, Ranchers, & Other Agricultural Managers 48.0% 1,146 2.28 High school diploma or equivalent Real Estate Sales Agents 47.5% 314 0.69 High school diploma or equivalent Postal Service Mail Carriers 45.5% 275 0.91 High school diploma or equivalent Directors, Religious Activities & Education 41.7% 132 0.98 Bachelor's degree Chief Executives 38.0% 329 1.05 Bachelor's degree Property, Real Estate, & Community Association Managers 36.5% 446 1.75 High school diploma or equivalent Education Administrators, Elementary & Secondary School 36.4% 143 0.62 Master's degree Managers, All Other 33.6% 295 0.44 High school diploma or equivalent Musicians & Singers 33.0% 176 0.94 High school diploma or equivalent Court, Municipal, & License Clerks 32.7% 165 1.21 High school diploma or equivalent Sales & Related Workers, All Other 32.3% 226 1.61 High school diploma or equivalent Middle School Teachers* 31.4% 529 0.84 Bachelor's degree Elementary School Teachers, Except Special Education 31.3% 987 0.72 Bachelor's degree Security Guards 30.8% 519 0.44 High school diploma or equivalent Secondary School Teachers* 30.6% 731 0.77 Bachelor's degree Heavy & Tractor-Trailer Truck Drivers 30.3% 2,850 1.52 Postsecondary non-degree award Cost Estimators 30.0% 213 0.94 Bachelor's degree
^ Also includes Processors, & Processing Machine Operators *Except Special & Career/Technical Education Source: EMSI Note: At least 100 jobs in 2014 and a high school diploma
To this point in this section, we have examined national trends related to projected occupational growth, decline, and jobs susceptible to retirement in the context of the Sioux Falls MSA labor force. The following table (Figure 25) aggregates all ten-year projection data to present the Sioux Falls area’s ten-year job-replacement needs. It should be noted that these data project the minimum level of necessary hires. The actual number of openings could potentially be higher, a situation caused by individuals switching occupations or moving out of the Sioux Falls region.
As could be assumed, the list of metro Sioux Falls’ occupations with the greatest growth and replacement needs mirrors other analyses in this report related to top current concentrations and hiring needs. Registered nurses are by far the largest category for replacement, over double the number two position, Bookkeeping, accounting, and auditing clerks. Also high on the list are Customer service representatives, Secretaries and administrative assistants, Heavy and tractor-trailer drivers and Sales representatives for wholesaling and manufacturing. Teachers also show up as a key category for replacement.
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FIGURE 25: TOP 40 OCCUPATIONS WITH THE LARGEST PROJECTED HIRING NEEDS (2014-24)
Growth and 2014 Description Replacement 2014 LQ Typical Entry Level Education Jobs Needs Registered Nurses 5,511 2,461 1.98 Associate's degree Bookkeeping, Accounting, & Auditing Clerks 2,966 1,054 1.61 High school diploma or equivalent Customer Service Representatives 4,442 922 1.75 High school diploma or equivalent Secretaries & Administrative Assistants* 1,940 792 0.72 High school diploma or equivalent Heavy & Tractor-Trailer Truck Drivers 2,850 777 1.52 Postsecondary non-degree award Sales Representatives, Wholesale & Manufacturing** 2,197 706 1.43 High school diploma or equivalent Nursing Assistants 2,077 660 1.37 Postsecondary non-degree award Office Clerks, General 1,795 625 0.54 High school diploma or equivalent Insurance Sales Agents 1,616 549 2.14 High school diploma or equivalent General & Operations Managers 1,420 503 0.67 Bachelor's degree Receptionists & Information Clerks 1,809 490 1.69 High school diploma or equivalent Accountants & Auditors 1,625 452 1.18 Bachelor's degree Elementary School Teachers, Except Special Education 987 394 0.72 Bachelor's degree Team Assemblers 1,312 373 1.16 High school diploma or equivalent Maintenance & Repair Workers, General 881 350 0.62 High school diploma or equivalent First-Line Supervisors of Office & Administrative Support Workers 902 333 0.62 High school diploma or equivalent Teacher Assistants 869 319 0.67 Some college, no degree First-Line Supervisors of Retail Sales Workers 1,203 318 0.81 High school diploma or equivalent Childcare Workers 1,802 297 1.37 High school diploma or equivalent Automotive Service Technicians & Mechanics 789 274 1.03 High school diploma or equivalent
*Except Legal, Medical, & Executive **Except Technical & Scientific Products Source: EMSI Note: Occupations with at least a high school diploma
The process for training and attracting workers to fill these positions of future need will be multi-faceted and rely on a network of partners working with employers to ensure that programs are in place with sufficient capacity to meet demand. The following section and Appendix of this report will begin to look at the Sioux Falls area’s education and training systems and outputs, both overall and by target sector, to gain an understanding of the region’s capacity to meet current and future employer hiring needs.
KEY FINDINGS Many customer service and support occupations (including those related to financial transactions processing and insurance claims processing) are highly susceptible to automation. This is a troubling trend for a region such as the Sioux Falls area with a high concentration of such jobs.
Trends impacting customer service and agriculture will disproportionately impact those on the lower end of the wage and educational attainment spectrum. However, retraining needs are not overly restrictive for these workers and the impact of automation on customer service representatives will be counteracted by growing demand.
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Occupations with high replacement needs due to growth or the impact of retiring workers include registered nurses and nursing assistants, clerical positions, sales representatives, truck drivers, carpenters, and numerous production-oriented positions, particularly team assemblers.
The Sioux Falls area’s future workforce needs will largely mirror current trends in which lower-skill, lower-wage positions experience greater talent shortages than occupations requiring a more advanced level of education.
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Are we developing sufficient talent to meet demand? To date, this report has focused principally on labor demand and not supply. Both sides of the equation are critical to ensuring that the Sioux Falls area’s workforce is sustainable. This section will examine current dynamics, capacities, and outputs of the region’s K-12 systems, technical colleges, four-year colleges and universities, and programs at all levels focused on developing, retaining, and attracting workers for in- demand occupations and industries.
With migration trends illustrating that the Sioux Falls MSA has an especially strong dependence on workers in the immediate area, growing the region’s incumbent workforce is even more important to the area’s success than in other regions. As such, we will examine historical degree completions by level and area of study in order to identify any potential shortages in the workforce development pipeline and ensure that local training programs can prepare workers with the skills needed to fill the occupations in demand. Additionally, regional analysis will look at program completions in subjects lacking in current job openings.
K-12 SCHOOLS K-12 districts represent the first and most important component of the training “pipeline” preparing students for college and careers. The Sioux Falls area’s top five public school districts based on enrollment numbers include Brandon Valley, Harrisburg, Sioux Falls, Tea Area, and West Central. Combined, the five districts have more than 30,000 students, accounting for roughly 80 percent of the region’s public school students. Sioux Falls School District, with a 2013-14 enrollment of over 23,000 students, is by far the largest district; Brandon Valley is the next largest at 3,485 students.
Due to its size, the Sioux Falls district is able to provide the most comprehensive early childhood programming in the region. The district features an Early Childhood Screening and Evaluation Center, infant and toddler services, and early childhood preschool experiences for eligible children before they are kindergarten age. A research-based curriculum, High/Scope, engages children in activities to encourage language, social, cognitive, adaptive, and motor-skills development. The Tea Area School District also offers pre-K services in its Tea Area Elementary School.
Figure 26 shows that the Sioux Falls School District is not only the largest, but has the highest number of students eligible for free and reduced-price lunch, a commonly held proxy to estimate low- income student percentages. The district’s total is over twice the next highest districts, Tea Area and West Central. Sioux Falls schools also have the highest dropout rates and the second-lowest teacher salaries, ahead of only the West Central district.
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FIGURE 26: ASSORTED METRICS, SIOUX FALLS AREA FIVE LARGEST K-12 DISTRICTS, 2012-2013 SCHOOL YEAR
% Eligible for Pupil to Base Total Free/ Red. Teacher Dropout Teacher District Enrollment Lunch ratio Rate Salary Sioux Falls 23,227 45.4 16.0 2.2 $33,469 Brandon Valley 3,485 17.6 16.9 0.2 $35,140 Harrisburg 3,041 15.2 13.6 0.7 $35,400 Tea Area 1,488 21.8 16.8 0.5 $33,500 West Central 1,304 21.8 15.8 0.7 $32,500
Source: South Dakota Department of Education
A high-level analysis of the Sioux Falls area’s five largest K-12 districts shows that regional students have generally performed well with higher graduation rates than state and national averages. Nearly 90 percent of students in the MSA graduated compared to 82.1 percent in South Dakota and 80.0 percent nationally. Additionally, students at the region’s top five public school districts had higher average ACT scores than both the state and national averages.
FIGURE 27: HIGH SCHOOL PERFORMANCE MEASURES, 2013-14 SCHOOL YEAR Graduation Average ACT Rate Score Sioux Falls MSA 87.4% N/A Brandon Valley 93.5% 23.8 Harrisburg 89.1% 22.4 Sioux Falls 83.2% 22.7 Tea Area 96.7% 22.8 West Central 96.7% 22.0 Aggregate of other districts in the metro 87.0% N/A South Dakota 82.1% 21.9
United States 80.0% 21.0 Source: South Dakota Department of Education
According to public input respondents, K-12 public education in the Sioux Falls area continues to be a strength, although changing demographics in the region – most particularly in the city of Sioux Falls core – are putting additional pressures on local educators. More than 90 percent of online survey respondents “agreed” or “strongly agreed” with the statement that children in their district received a high- quality education. However, challenges are increasing. In the 2012-13 school year, nearly half of students in the Sioux Falls school district were eligible for free and reduced lunches. Combined with the other four
Page 46 – April 2015 Workforce Sustainability Analysis districts with the highest enrollment, roughly 40 percent of regional students were eligible for the program. Another expressed concern was the impact that the area’s growing diversity was having on school systems. Again, the situation is most acute in the Sioux Falls district where nearly 10 percent of students were limited English proficient or English language learners.
Also straining districts’ ability to effectively educate children is the continuing turnover in their teacher ranks. Replacement rates for local faculty are higher than in neighboring states as teachers are forced to leave the profession in search of a living wage or are driven to adjacent, out-of-state districts because of higher average salaries. As was noted earlier, local districts in South Dakota have “opt-out” opportunities to increase teacher pay, but these funds sunset and are still not sufficient to raise salaries to competitive levels. Relationships between K-12 districts and employers are often strong, but take place on a company-by-company basis because there is reportedly no overarching “umbrella” entity coordinating these relationships. The Sioux Falls district features a number of active internship and job-shadowing partnerships with local employers, who also contribute resources and expertise in the district’s Career and Technical Academy and New Technology School.
Indeed, the Sioux Falls area and its largest district (Sioux Falls School District) have launched and expanded several programs designed to better prepare students for college and careers. Specifically, the Sioux Falls district features several specialized schools at all levels of education. At the elementary level, the following specialized options are available to families:
All City Elementary is a tuition free public school and the only specialized school that incorporates parents into their classrooms.
Eugene Field A+ became South Dakota’s first A+ (arts plus academics) school in the fall of 2001. Daily arts instruction includes drama, visual art, music and dance.
The Challenge Center at Garfield is designed to offer an accelerated/advanced curriculum for gifted students grades two through five. The curriculum is built around unifying concepts that encourage depth and breadth of content and provide application connections to the real world.
At Lowell Math, Science, and Technology School all students receive curriculum taught with an emphasis on math, science, and technology and hands-on learning. Through partnerships with local businesses and organizations, students participate in research, field trips and special projects.
The Rosa Parks Global Studies/World Language School integrates global learning and understanding into all subject areas at all grade-levels. Students develop knowledge of other countries and continents through classroom lessons and service learning projects.
The Spanish Immersion Program is a specialized language immersion program housed at two schools, Rosa Parks and Robert Frost, that allows English-proficient students to become bilingual and bi-literate in Spanish. Students attending the immersion program receive all classroom instruction in Spanish beginning in kindergarten.
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At the middle school level, students have access to gifted education courses at Edison Middle School, where they receive accelerated, integrated, and enriched instruction in core subjects. The Middle School Spanish Immersion program is also located at Edison Middle School.
Many input participants felt that there was not enough emphasis on career paths and “planting the seed” for students to begin thinking about their career options in middle and secondary school. Roughly 40 percent of survey respondents “strongly disagreed” or “disagreed” with the statement that career education received adequate attention in K-12, while the statement that schools provided high quality career guidance and college counseling services was divided in agreement. Focus groups and interview participants expressed preferences that career education begin earlier in students’ careers. The Sioux Falls school district created the following two campuses to support career education and technology immersion.
The New Technology High School opened in 2010 to provide students a 1:1 computer environment for researching, communicating and solving problems in the community. New Tech uses its curriculum to engage students as they develop presentations to demonstrate their knowledge and skills. Grades are determined on factors such as work ethic, collaboration, communication, critical thinking and content knowledge. Students participate in internships and post-secondary coursework during their junior and senior years. Public input regarding New Tech High School reported that it has been a good addition with a strong relationship with the business community.
Approximately 875 high school sophomores, juniors, and seniors at traditional high schools in Sioux Falls attend the Career and Technical Education Academy (CTE Academy) for a two- hour block during their regular daily schedule, where they participate in programs that include Media Production, Health Science, Biomedical Sciences, Carpentry, Hospitality & Tourism, Culinary Arts, Engineering, Auto Tech., Auto Body, Manufacturing, Welding, and Human Services. All programs are state-approved courses that fulfill certain graduation requirements.
o Also at CTE Academy is the Academy of Finance, a multi-year program affiliated with the National Academy Foundation. This national program is designed to prepare students with practical skills to enter the world of business and finance. Students have the opportunity to earn up to 17 college credits while in high school.
o CTE was highly regarded among community stakeholders. Employers reported that the business community has a strong relationship with CTE and that it is training students to help meet their demand. The welding program was specifically mentioned as impactful to supply employers with trained future workers.
Despite this growing array of programs, there is a widely reported and corroborated attitude in greater Sioux Falls –and, indeed, statewide – that discourages students from pursuing career and technical education and employment in the skilled trades at the expense of aspiring to a traditional four-year college degree. In fact, some higher education officials consider the “bias” against trades employment as the top constraint preventing the acceleration of student participation in courses preparing them for the
Page 48 – April 2015 Workforce Sustainability Analysis region’s (and state’s) occupations in greatest demand. Stated and implied biases against career and technical programs and employment are reportedly found not only in students’ homes, but also in college and career placement offices in high schools and colleges as well as the state’s Board of Regents. Statewide programs discussed later in this section are trying to counter these biases through investment in internal and external marketing focused on the benefits of skilled-trades positions.
HIGHER EDUCATION The next stage of the “cradle to career” training pipeline for local workers is the higher educational system. Public input and migration patterns indicated that employers in the Sioux Falls area predominantly recruit employees from regional technical programs and the state’s two large public universities. However, structural issues such as the lack of a main or branch four-year public university campus, no statewide community college system, a disconnect between technical institutes and four-year colleges, and structural funding and student-attraction issues at the University Center hamstring local efforts.
The lack of transferability between technical colleges and four-year institutions in Sioux Falls and South Dakota was cited by input participants as a key constraint. There is no guarantee that students who take associate’s level courses will be able to apply these credits to local or state universities, a situation that reportedly drives many students out of state to obtain their degrees. This lack of transferability stems from a situation unique in the nation to South Dakota – the lack of a community college system. Not only does this reality obviate a “feeder system” from two-year to four-year schools, it also adversely affects technical institutes’ abilities to remediate new students who may lack basic math, science, and English skills. In an attempt to fill a vacuum of transferable two-year degrees, the state’s principal four-year universities have increasingly started offering associate’s degrees, a situation that reportedly puts them in further competition with technical institutes for student dollars.
Two-Year Institutions Southeast Technical Institute (STI) is one of South Dakota’s four technical institutes. Governed jointly by the South Dakota Department of Education, the South Dakota Board of Education and the local school board8, Southeast Tech’s mission is “to educate individuals for employment opportunities, professional growth and lifelong learning.” The campus is located in Sioux Falls and consists of six buildings: the Mickelson Education Center; the Terrence Sullivan Health/Science Center; the Ed Wood Trade and Industry Center; the Technology Center; the Scarbrough Child Care Center; and Nicolay-Hummel and Andera Residence Halls. The institution offers over 50 programs in eight subject areas: advanced technologies, business and communications, engineering technology, health technology, horticulture technology, human services technology, industrial technology, and transportation technology. STI turns out the third largest higher education graduating class in the state.
According to public input, key STI challenges include the previously reported lack of transferability of course credits, competition from four-year schools offering two-year degrees, and local and statewide biases against trades employment that creates situations in which demand does not satisfy availability of
8 A recent development. STI previously reported directly to the Sioux Falls school district superintendent.
Page 49 – April 2015 Workforce Sustainability Analysis training slots for certain key programs. STI also reportedly has difficulty paying instructors enough to attract them away from private-sector employment.
Kilian Community College is South Dakota’s only private, non-tribal community college. Established in 1977, Kilian is located in the heart of downtown Sioux Falls and is known for its small class sizes. The community college offers seven Associate of Arts programs (liberal arts, education, Native American studies, business management, psychology, sociology, and history); four Associate of Science programs (business management, information systems, criminal justice, and social work); six Associate of Applied Science programs (accounting, business management, chemical dependency counseling, early childhood education, healthcare coding and reimbursement, and medical administrative services); and two certificate programs (chemical dependency counseling and healthcare coding and reimbursement).
Four-Year Institutions Augustana College was founded in 1860 and is a selective, private, residential, comprehensive (liberal arts and professional) college of the Evangelical Lutheran Church in America. Augustana offers 52 majors, 40 minors, and 14 pre-professional specializations to its approximately 1,800 full- and part-time students. These programs are offered within three departments: Humanities, Natural Sciences, and Social Sciences. In addition to its undergraduate programs, the school offers two Master of Arts degree programs: education and sports administration and leadership. Another option available to Augustana students is its Dual Degree Engineering program, in which the student studies toward a B.A. from Augustana in a major of his choice and a B.S. in a chosen engineering specialty from a partner school. Affiliated schools currently consist of Columbia University, University of Minnesota, and Washington University St. Louis. Augustana also has a number of programs in partnership with K-12 districts in greater Sioux Falls.
The South Dakota Public Universities and Research Center, also referred to as “University Center,” (UC), offers certificate, associate, bachelor, and graduate degree programs from six South Dakota universities: Black Hills State University, Dakota State University, Northern State University, South Dakota School of Mines and Technology, South Dakota State University, and The University of South Dakota. Academic programs include:
Three certificate programs: Executive banking and financial services, intermediate banking and financial services, and health care coding
Eleven associate degree programs: Applied gerontology, banking and financial services, business management, general studies (by three institutions), health information technology, industrial technology, network and system administration, respiratory care, and tourism and hospitality management
Thirty-five bachelor degree programs: general studies (by five institutions), banking and financial services, business administration with five concentrations (accounting, economics, finance, management, and marketing), business technology, computer science, consumer affairs with two emphases (consumer services management and family financial management), criminal justice, cyber operations, economics, entrepreneurial studies, graphic design, health information administration, health sciences, human development and family studies, information systems,
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interdisciplinary studies, international business, journalism, network and security administration, nursing (by two institutions), accelerated nursing, professional and technical communication, psychology, respiratory care, and sociology
Fourteen graduate programs: Doctor of Science in Information Systems, Ph.D. in Nursing, Master of Business Administration (by two institutions), Master of Professional Accountancy, Master of Science in Administration with six specializations (drug abuse studies, health services administration, human resources, interdisciplinary studies, long-term care administration, and organizational leadership), Master of Science in Information Assurance, Master of Science in Information Systems, and Master of Science in Nursing
According to public input, the UC has challenges inherent to its mission and funding model. Competition from online degree programs from public and private colleges has also undercut the Center’s principal student clientele, mid-career and adult learners. Because the UC is not a traditional campus with student- fee-funded programs, clubs, and amenities, it is difficult for the Center to attract traditional students. However, local officials feel it will be important for the Center to become more competitive for these students if it is to survive. Opportunities to improve the student experience could involve supporting adjacent development such as student apartments and student-focused retail as well as capitalizing on the rapid development of the University of South Dakota Discovery District quickly enveloping the UC buildings.
Founded in 1883, the University of Sioux Falls (USF) is a Christian, Liberal Arts University affiliated with the American Baptist Churches, U.S.A. USF, which has an enrollment of 1,419 students, has over 80 undergraduate academic programs in nine categories (Fine Arts, Humanities, Interdisciplinary, Nursing, Natural Sciences, Social Sciences, Fredrikson School of Education, Pre-Professional Programs, and Vucurevich School of Business). Graduate programs include a Master of Business Administration with four available concentrations (business innovation and marketing, general management, healthcare management, and project management); an Ed.S. in Educational Administration with two tracks (superintendent and principal), M.Ed. in Educational Administration: Adult and Higher Education, M.Ed. in Teaching (an initial certification for non-educators), and four M.Ed. programs for currently licensed teachers (Reading Specialist Authorization, Reading Specialist Authorization aimed at Rapid City Area Schools, Educational Leadership – Principal Licensure, and Educational Leadership – Technology Endorsement). The university also offers online and on-campus adult and graduate programs to help adult learners finish their degrees or earn advanced degrees.
Completions The following section details degree awards from higher educational institutions within a one-hour’s drive of central Sioux Falls – in other words, local employers’ labor shed. Figure 28 shows these schools and their enrollment and degree awards in 2013. There are over 33,000 students within a one-hour’s drive of central Sioux Falls and a total of 6,921 degrees presented in 2013 alone. This is a significant number of graduates the Sioux Falls area can capitalize on if connections are made and opportunities communicated that would lead to the retention of these new workers in the region.
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Degree awards will be linked with occupational and employment data focused on the Sioux Falls area’s target sectors in the Appendix of this report.
FIGURE 28: HIGHER EDUCATIONAL INSTITUTIONS, SIOUX FALLS LABOR SHED, 2013 Total PhD or Enrollment Cert. Assoc. Bach. Master Prof'l Total Augustana College 1,765 - - 371 15 - 386 Avera McKennan Hospital School of Radiologic Tech. 20 10 - - - - 10 Avera Sacred Heart Hospital 18 6 - - - - 6 Dakota State University 3,129 8 54 249 67 4 382 Kilian Community College 253 4 34 - - - 38 Mount Marty College 1,225 11 21 133 32 - 197 Sanford Medical Center 24 14 - - - - 14 Sioux Falls Seminary 143 - - - 28 - 28 South Dakota State University 12,525 25 21 1,988 324 118 2,476 Southeast Technical Institute 2,467 326 609 - - - 935 University of Sioux Falls 1,408 - 12 308 117 - 437 University of South Dakota 10,235 5 341 952 509 205 2,012 Sioux Falls Labor Shed 33,212 409 1,092 4,001 1,092 327 6,921 Source: NCES
Of the institutions in the one-hour radius, the largest output was in four-year bachelor’s degrees followed by associate’s degrees. However, over the past five years the number of associate’s degrees completions has been increasing at a faster rate than bachelor’s degrees. Between 2008 and 2013, the number of associate’s degrees awarded increased by 28.0 percent (240 degrees) compared to a 15.3 percent increase (520 degrees) at the bachelor’s level.
Approximately 25 percent of program completions are within the field of health professions and related support services, which aligns with the target sectors and local employers demand for skilled workers. Output of these degrees has increased significantly over the past five years in an effort to meet the demand of local employers. There is also a higher concentration of business, management, marketing, and related support services locally than what is seen at the national level.
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FIGURE 29: CONCENTRATION OF PROGRAM OUTPUT, SIOUX FALLS LABOR SHED AND US Share of Total Completions Program SF Labor Shed United States Difference Business, management, marketing, & related support services 22.0% 15.7% 6.3% Health professions & related clinical sciences 24.8% 19.2% 5.6% Computer & information sciences & support services 6.3% 3.0% 3.3% Personal & culinary services 4.8% 3.4% 1.4% Education 8.1% 6.8% 1.3% Parks, recreation, leisure, & fitness studies 2.4% 1.2% 1.2% Family & consumer sciences/human sciences 2.3% 1.1% 1.2% Engineering technologies/technicians 2.7% 1.7% 1.0% Mechanic & repair technologies/technicians 3.1% 2.2% 1.0% Agriculture, agriculture operations, & related sciences 1.3% 0.6% 0.7% Source: EMSI
As shown in Figure 30, the number of certificates issued in the labor shed in the past five years has increased by 27.8 percent, likely fueled by employer demand to get job candidates trained quickly. Specifically, STI added a family and consumer sciences program to help satisfy the growth in demand for child care workers. Representatives from the community and social service organizations also reported the need for an accredited certification program for interpreters. Other stakeholders expressed the need for more computer training courses catering to individuals less familiar with computers such as older individuals and refugees.
Because of the high demand for workers, employers participating in public input identified additional training and certification programs of need. Skilled trade representatives would prefer a one or two year program for carpentry or building trades. Lake Area Tech, Mitchell Tech, and Western Iowa tech all have offer such programs, but similar courses are not available at STI. Individuals in social work also expressed frustration in the need for a career path into their line of work. CDL training is another area that lacks local training options. It is projected that there will be roughly 800 openings for drivers with CDLs over the next ten years.
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FIGURE 30: REGIONAL CERTIFICATES AWARDED, BY PROGRAM (2013) Award of Award 2 Award <1 >1 but <2 but <4 Above the academic academic academic baccalaureate Total Program year years years level Certificates Grand Total 197 161 51 69 478 Health Professions & Related Programs 55 159 35 10 259 Computer & Information Sciences & Support Services 57 - - 4 61 Education - - 0 33 33 Family & Consumer Sciences/Human Sciences 30 - - 0 30 Visual & Performing Arts 21 - - - 21 Psychology - - - 19 19 Mechanic & Repair Technologies/Technicians - - 16 - 16 Business, Mgmt, Marketing, & Related Support Services 10 2 - 2 14 Precision Production 12 - - - 12 Engineering Technologies & Engineering-related Fields 11 - - 0 11 Social Sciences 1 - - - 1 Theology & Religious Vocations - - - 1 1 Agriculture, Agriculture Operations & Related Sciences 0 0 - 0 0 Communication, Journalism, & Related Programs - - - 0 0 Engineering - - - 0 0 English Language & Literature/Letters 0 - - - 0 Public Administration & Social Service Professions - - - 0 0 Source: NCES
Figure 31 shows the top ten degree award program categories for the Sioux Falls labor shed. Because the Sioux Falls MSA offers very limited doctoral or professional degree programs, the region depends on graduates from South Dakota State University (SDSU), the University of South Dakota (USD), and Dakota State University (DSU) to supply the training for these positions. Exceptions are two programs offered through the University Center: a PhD in Nursing and D.Sc. in Information Systems.
Increased output for degrees in health professions and related programs has no doubt stemmed from the strong growth in the health care sector. Associate’s degrees increased by 33.6 percent, while bachelor’s degrees increased by 48.7 percent. Degrees in psychology and liberal arts are also among the top ten degree completions by programs. Occupational outlook in the area is not as strong as other areas of studies for individuals graduating with bachelor’s degrees, but internships or teacher certification programs are two options that would offer them experience and qualifications to find employment in the area.
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FIGURE 31: TOP 10 REGIONAL DEGREES AWARDED, BY PROGRAM, SIOUX FALLS LABOR SHED (2013)
Doctor or Associate's Bachelor's Master's professional Total Program degree degree degree degree Degrees Grand Total 1,092 4,001 1,092 327 6,512 Health Professions & Related Programs 441 879 174 169 1,663 Business, Mgmt, Marketing, & Related Support Services 224 401 153 0 778 Education 5 336 229 37 607 Social Sciences 0 278 24 1 303 Agriculture, Agriculture Operations & Related Sciences 52 222 16 2 292 Biological & Biomedical Sciences - 223 31 22 276 Psychology 2 169 94 7 272 Computer & Information Sciences & Support Services 76 125 55 4 260 Parks, Recreation, Leisure & Fitness Studies - 178 23 0 201 Liberal Arts & Sciences, General Studies & Humanities 84 93 19 0 196 Source: NCES
What these data show are that degree awards in the Sioux Falls area’s labor shed at least partially reflect identified employer demand, especially for health professions, business and related categories, and education. However, as this report has shown, the majority of reported job openings in the Sioux Falls MSA only require high school completion or else a certificate or two-year degree. Therefore, efforts must be significantly increased to direct non-college-bound high school seniors, underemployed workers, adults that have left the labor force, and talent attraction efforts on those occupational categories with high levels of opening not satisfied by training institutions in the labor shed. This will require a major cultural shift in the Sioux Falls area (and statewide) towards the benefit of career and technical education, school-to-work programs, and training for skilled trades occupations.
CITY, STATE, AND REGIONAL PROGRAMS There are a variety of programs highlighted below that are offered by multiple partners and institutions and are aimed at enhancing local and regional talent development in a number of key ways.
TechEd Works for Me, the workforce initiative launched by Forward Sioux Falls and Southeast Tech, seeks to elevate the image of technical education and position it as a fast-track solution to a career. The program encourages area businesses to connect technical institute graduates with employment and advancement opportunities. Community stakeholders reported that they would like to see the initiative continued.
ShadowED is a clearinghouse created out of Forward Sioux Falls to arrange shadowing experiences for Sioux Falls high school students. Each year, over 300 students take part by choosing one of 200 occupations of interest. Between 2006 and 2011, during the Forward Sioux Falls V cycle, Shadow ED coordinated more than 1,650 job shadowing experiences. Nearly 100 businesses open their doors each
Page 55 – April 2015 Workforce Sustainability Analysis year to ShadowED students. Input participants reported that there’s been a drop in participation and that there is a need to increase opportunities and involvement by the schools and businesses.
The first Learners to Leaders program in the region was launched in conjunction with John Morrell & Co. (now John Morrell Food Group), Sioux Falls School District, and Southeast Technical Institute. High school students begin the program as juniors by enrolling in STI classes, earning credit in a variety of disciplines toward their high school diplomas as well as STI degrees. Upon high school graduation, students can continue toward their Associate of Applied Science degrees at the STI campus.
Build Dakota is a scholarship program created in 2014 through a $50 million dollar investment funded by a $25 million donation from T. Denny Sanford, the Chairman of the Board of United National Corporation, and a $25 million contribution from the South Dakota Future Fund. Build Dakota Scholarships will be awarded to skilled students entering high-need workforce programs at South Dakota technical institutes to support tuition, fees, books, and other required program expenses. Recipients of the scholarships must commit to working full-time in their field of study in South Dakota for at least three years following graduation. In the first five years, a projected 300 scholarships will be awarded annually. Beyond the first five years, the endowment will support approximately 50 full-ride scholarships. There are 54 eligible program options within eight industry areas, which include automotive fields, building trades and construction, energy technicians, engineering technicians, licensed practical nursing, medical lab technicians, precision manufacturing, and welding.
The Dakota Corps Scholarship was designed by Governor Mike Rounds in 2011 to keep South Dakota high school students in the state by providing full tuition and generally-applicable fees to selected qualified applicants. The program is funded by private businesses, nonprofit corporations, the Governor's Office and the South Dakota Department of Labor. Sixteen colleges and universities, including many in the Sioux Falls labor shed, participate in the scholarship program and have the discretion to limit the number of recipients they accept, set the eligibility requirements higher than the minimum, or not offer any or all critical need majors.
The Sanford Program for the Midwest Initiative in Science Exploration (PROMISE) is a partnership between research scientists, school districts, educational institutions, and community partners to establish programs that connect people to research being conducted in the region and to build strong relationships between scientists and their communities. The goal of Sanford PROMISE is to increase community understanding of science, raise awareness of the benefits of research, and emphasize the role of both in our society.
The state’s Career Learning Centers work closely with the South Dakota Department of Labor and Regulation to provide education and employment training services that meet the needs of local job seekers and businesses. Job seekers work with career specialists to develop an employability plan will be prepared to address personal education and job training needs. They also receive assistance in searching for jobs, job retention skills training, and counseling on topics such as budgeting, substance abuse and self-esteem. The cost of various programs may be subsidized through federal, state and local grants for eligible applicants. Many of the programs and services are also available on a tuition basis. There are six centers in
Page 56 – April 2015 Workforce Sustainability Analysis the state, though none are located in the four-county Sioux Falls MSA. The closest centers are the Yankton location, southwest of Turner County, and the Mitchell location, west of McCook County.
South Dakota has more than 100 U.S. Department of Labor Registered Apprenticeships. Registered Apprenticeship programs aid in recruiting new personnel, support the activities of human resources departments of participating businesses, and help employees become nationally certified. There are currently close to 1,000 apprentices registered in apprenticeship programs in South Dakota in sectors such as construction, dental, municipalities, health services, fire protection, fire medic, electric, plumbing, and building maintenance.
South Dakota WINS is a workforce development program that brings together government, education and business leaders. The components of this program are intended to help South Dakota develop and attract a stronger, better educated workforce. Initiatives include one-day career cluster camps, expanded advanced placement and dual credit courses, remediation courses for in-need students before they leave high school, the University Student Success program, and programs like SD MyLife, SDWORKS, and Dakota Roots. SD MyLife, a program by the South Dakota Department of Education and a component of SD WINS, provides online career development tools for South Dakota students. The program's goal is to help students better understand how their interest, skills, and knowledge relate to real-world academic and career opportunities. Through this platform, high school students are able to research career interests by career cluster, keyword, or school subject area; take interest and ability assessments to find career matches; and map their high school and postsecondary education and training; and build a Personal Learning.
The Department of Labor and Regulation’s SDWORKS is a one-stop shop database that lists all jobs and internships offered by state government, the Board of Regents, and state technical institutes. Private companies and organizations are also able to post available internships. All students attending a post-secondary institution in South Dakota are encouraged to take advantage of the database to find internships. Currently, there are over 13,000 job openings posted on the site.
An initiative to grow the South Dakota workforce, Dakota Roots is a website that connects citizens, business leaders, and government. The goal of Dakota Roots is to expand the South Dakota workforce by encouraging those with ties to the state to return to available job opportunities. The website launched in October 2006 and has gained many business partners and active users. The number of new job seekers that have utilized the Dakota Roots program has grown from 250 in 2006 to 5,027 in 2013. Businesses are able to receive assistance finding employees and filling skill gaps when they become partners.
The City of Sioux Falls launched its Workforce Development Pilot Program in January 2015 to support and explore activities to drive workforce growth and development within the community. The goal of the pilot program is to provide funding to local entities that are well-positioned to address workforce development and recruitment in Sioux Falls. As part of the 2015 budget approval process, the City Council
Page 57 – April 2015 Workforce Sustainability Analysis included $500,000 to support workforce development efforts within the community. The program will be available to any business, organization, or entity with operations in Sioux Falls. The award amount range spans from $2,000 to $100,000. While matching funds are not required, availability of matching financial or in-kind resources may be a factor in the City’s determination of awards.
KEY FINDINGS With the Sioux Falls MSA’s especially strong dependence on workers in the immediate area, growing the existing workforce is more important than in regions that more effectively attract external talent.
The Sioux Falls area’s K-12 districts are considered to be strengths by the vast majority of input participants. Even so, demographic changes threaten to compromise performance gains while challenges to attract and retain teachers may soon become critical.
The region’s K-12 districts are increasingly offering more options for students interested in specific careers or exposure to career and technical occupations.
A reported bias against career and technical education and skilled-trades occupations threatens to perpetuate under-enrollment trends in associated training programs and limit the Sioux Falls area’s ability to fill talent-impacted lower-skill and lower-wage occupations.
The Sioux Falls region’s technical institute is a key lynchpin in the local training pipeline, but suffers from endemic challenges related to a lack of transferability of credits, a bias against its programs among parents, school administrators, and state education officials, challenges to attract and retain faculty, and a funding system that is more reactive than proactive.
The Sioux Falls University Center provides important capacity to train for local careers, but is experiencing declining enrollment due to competitive pressures from online colleges as well as disadvantages to attract and retain “traditional” college students who prefer the region’s private colleges and the state’s public institutions where student housing is common and fees provide a more complete collegiate experience.
Degree awards from institutions in the Sioux Falls labor shed offer a competitive array of programs in many of the region’s top occupations, but current demand is for employable high school graduates with a good work ethic, the potential to be trained on the job, or a certificate or associate’s degree for in-demand fields.
A bevy of local and state programs support students’ educational ambitions and offer exposure to college and careers. Build Dakota, a new state program, aims to significantly increase participation in two-year programs at South Dakota’s technical institutes.
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CONCLUSION The quantitative and qualitative research conducted for this Workforce Sustainability Analysis highlighted key trends and challenges the Sioux Falls area faces in order to provide a sustainable talent pool for its employers. Data presented a picture of an extremely tight labor market that is causing thousands of positions to remain unfilled, many of them in lower-skill, lower-paying occupations. Employers are being forced to search harder for workers, pay them more, hire under-qualified applicants, or leave the jobs unfilled. Conversely, a dearth of employment opportunities at the higher end of the skills spectrum has left many workers in situations where they are “underemployed” for their current positions.
A number of factors have contributed to the region’s gaps in available talent for in-demand positions. Among these are a pure lack of bodies; unemployment is low and most of the available talent for growing job categories has been hired, many of them before they even finish their degree programs. For the most impacted positions, employers are reportedly poaching employees from other Sioux Falls area companies. What is striking about the region’s current talent and employment dynamics is the predominance of job openings for positions on the lower end of the skills spectrum and pay scale. Even for trades positions, the majority of these jobs require less than a bachelor’s degree for eligibility. Because of this, the state and region’s long-held biases against career and technical education and skilled trades positions has created surpluses of training slots for many certificate and two-year degree programs and frustration among companies, career and technical education providers, and technical institute officials that students who could benefit from this type of training are instead being pushed into four-year degree programs.
Despite dire talent shortages and continuing challenges to direct students to the skilled trades, progress is being made in South Dakota and the Sioux Falls area to create additional training programs, expose children to career opportunities earlier in their educational careers, and promote the advantages of career and technical fields to parents, school administrators, and state education officials. A program like Build Dakota is evidence that awareness of the need for technical education and trades workers has reached a critical mass. Even with this dawning realization, however, the Sioux Falls region is hamstrung in its ability to respond to employer demand and enhance its talent pipeline for fast-growing occupations. At the K-12 level, an increasingly low-income population with a growing percentage of limited-English-proficiency students challenges educators to effectively present career opportunities to these youth and train them for college and the workplace. At the two-year level, the state’s lack of a community college system has resulted in a structural disconnect between technical institutes and four-year colleges that limits credit transferability and often drives students outside South Dakota to finish their degrees. Funding formulas also reward past performance but do not account for future demand.
At the four-year level, a lack of a stand-alone four-year public university campus reduces the Sioux Falls region’s capacity to produce graduates in fields requiring a bachelor’s degree or higher. Challenges the University Center faces from competition with private online colleges and, indeed, the state’s main four- year public campuses themselves have put the Center’s programs in peril of decline or discontinuance. Attempts to attract more “traditional” students will be difficult but necessary if the UC is to optimize its impact on the local training pipeline.
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Above all, the fact that the Sioux Falls area has deemed talent development worthy of its own singular strategic process is evidence that regional leaders understand the challenges presented by an impacted labor force capacity and are motivated to find solutions. Proposed recommendations to enhance greater Sioux Falls’ talent development systems will be included in this process’ Action Agenda. Effectively implementing them will be an even more critical challenge as certain of the region’s issues are structural, solvable only at the state level, or the result of generations’ worth of attitudes about the value of a four- year degree versus the pursuit of a career in the skilled trades. It will be important that the identified lack of an “umbrella” coordinating entity overseeing talent development in the Sioux Falls area also be addressed so that efforts can be optimally aligned, collaborative, and sustainable.
Key Questions This Workforce Sustainability Analysis has sought to answer a number of key questions that relate to the Sioux Falls area’s future workforce capacity and output. The following questions and summarized answers will directly inform the development of the region’s workforce Action Agenda.
Do we have a sustainable workforce capable of supporting job growth in the decades ahead? The road ahead will be challenging for the Sioux Falls area. Job growth will be dependent on increased labor force capacity, while the labor force is constrained by the maximization of existing supply and challenges in attracting out-of-state talent.
Retaining local graduates, increasing the supply of applicants for programs serving impacted occupations, and changing attitudes on the value of career and technical jobs will be important strategies. On-the-job training, new certificate programs, and enhanced use of job-shadowing, internships, and other tools will also help boost the training pipeline for in-demand careers.
Where are our most immediate workforce training needs? Principally, these include technical trades such as mechanics, truck drivers, welders, carpenters, and machinists. In fact, many of the region’s most pressing training needs are for occupations that require less than a four-year college degree and, in some cases, only a high school diploma or equivalent.
Registered nurses and nursing assistants are key needs and are served by programs at Augustana, USF, and STI. Output of graduates will need to be increased to meet current and future demands.
There is a critical need for teachers in the Sioux Falls area, but successfully addressing this occupation’s talent supply will require either state or local salary increases.
Other occupations in need include engineers, sales representatives, network and systems administrators, interpreters, and business support staff.
What parts of the country are workers coming from? The region’s in-migrants are typically arriving from other South Dakota regions, and, in fewer numbers, from major Midwest metropolitan areas and international countries.
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Efforts to better promote greater Sioux Falls outside the state – a component of the Build Dakota initiative – will be important to increasing the flow of external workers to the region.
Are educational systems aligned with current and future employment needs The short answer is that many systems are aligned with projected needs, but the output of graduates must be significantly enhanced to meet future demand.
The Sioux Falls area is better situated to meet demand for occupations requiring certificate and associate’s degrees. The region’s four-year-degree-granting capacity is limited by the lack of a main or branch four-year public university campus. Enhancing the attraction and retention of graduates from institutions in the Sioux Falls area’s one-mile labor shed will be an important strategy.
What state-level changes might be needed to achieve optimal levels of alignment Principally, state-level changes that would most beneficially impact greater Sioux Falls’ talent development involve increasing pay for teachers and raising institutional budgets for the state’s technical institutes. Per-student, South Dakota spent about $3,300 on two-year colleges last year, with students paying an average of $4,155 more than any other state in the Midwest, according to the National Center for Education Statistics.
Changing the governance structure for technical colleges would also have a positive effect for the region’s training pipeline and allow STI the flexibility to better align classes with the workforce needs of companies.
Though aspirational, a potentially transformational state-level decision for the Sioux Falls area would be the chartering of a branch four-year public university campus in the region.
Which occupations and business sectors are most susceptible to impending retirement? Primarily, the answer is teachers and truck drivers. The Sioux Falls area’s age dynamics are generally favorable, with fewer occupations at risk of shortages from retirements than the U.S.
What occupations are most susceptible to technological advancements? As with anywhere in the country, the jobs most susceptible to being eliminated due to advances in technology are those that feature processes that could be automated. Principally, these would include order clerks, insurance claims and policy processors, tellers, telemarketers, postal carriers, and other lower-skill occupations.
How should our talent attraction, retention, and development strategies be differentiated by skill set and/or occupation based on the analysis of occupational characteristics? This report has provided a rich vein of data to be utilized by greater Sioux Falls education and training providers to inform future programmatic needs and demands.
Strategies will largely be determined by potential capacity enhancements at the region’s training institutions. If resources limit the development of new programs or the addition of training slots, talent attraction strategies will be paramount.
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Above all, better aligning training providers with employer demand will enable programmatic development to be more proactive and allow education officials to better anticipate strategies to either create new capacity or focus efforts on identifying and recruiting external talent.
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APPENDIX A: OCCUPATIONAL BREAKOUT The following pages provide a detailed outlook of the most common occupations found in the Sioux Falls region by business sector and include some of the area’s predominant and targeted sectors: healthcare, finance and customer care, biotechnology, information technology, and advanced manufacturing. Data represent total employment for each occupation in the Sioux Falls MSA, rather than the number of jobs in the sector’s share. Therefore, occupations that are found in multiple sectors have been placed in the table that has the largest employment of workers in the occupation. The data includes all pertinent information that was provided throughout this report for the profiled sectors and serves as a reference guide for the job outlooks for top occupations. Data regarding completions is provided for two principal geographic levels. Two-year completion data is for the four-county Sioux Falls MSA. But, because programs at the University Center are considered part of their main campuses, degree-award data is not broken out for this satellite location. Therefore, degree-award data at the four-year level is for the one-mile Sioux Falls labor shed geography for the UC’s affiliated institutions. Values with an asterisk (*) indicate that employment over age 65 was suppressed.
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INFORMATION TECHNOLOGY
Current Trends Projected Growth (2014-24) Projected Demand and Supply Attributes 2014-24 2004-14 2013 Avg. Description 2014 2014 SF % US % Pct. Pt. SF # SF # Openings 2013 Regional Earnings Typical Entry Level SF % Hourly LQ Jobs Chg. Chg. Difference Chg. 55+ (Growth plus Completions Ratio Education Chg. Earnings replacements) Network and Computer Systems Administrators 1.96 754 44.3% 8.0% 12.9% -4.9% 60 68* 128 37 $28.99 0.78 Bachelor's degree Computer User Support Specialists 1.17 739 40.2% 15.3% 19.8% -4.5% 113 75* 187 88 $17.34 0.72 Some college, no degree Software Developers, Applications 0.54 376 12.3% 28.4% 23.4% 4.9% 107 30* 136 39 $35.97 0.78 Bachelor's degree Computer Systems Analysts 0.60 333 27.3% 30.5% 23.3% 7.2% 102 41* 142 39 $31.28 0.77 Bachelor's degree Computer Programmers 0.87 302 45.4% 9.5% 10.9% -1.4% 29 32* 61 26 $26.68 0.70 Bachelor's degree Software Developers, Systems Software 0.37 148 -34.8% 39.6% 21.6% 18.0% 59 11* 70 39 $39.89 0.80 Bachelor's degree Computer Network Architects 0.98 147 27.6% 12.0% 14.8% -2.8% 18 12* 29 101 $43.45 0.93 Bachelor's degree Web Developers 0.73 113 33.5% 14.4% 23.1% -8.7% 16 <10 <26 101 $27.87 0.95 Associate's degree Database Administrators 0.80 98 26.7% 15.1% 15.9% -0.9% 15 12* 27 13 $35.82 0.92 Bachelor's degree Information Security Analysts 0.59 49 32.1% 39.0% 32.7% 6.3% 19 <10 <29 101 $38.70 0.88 Bachelor's degree Computer Hardware Engineers 0.22 19 -77.7% 52.8% 11.4% 41.3% 10 <10 <20 0 $39.52 0.77 Bachelor's degree Profile: While the information technology sector in the Sioux Falls region represents a relatively smaller share of jobs, it is an area that has been growing quickly over the past ten years and employment in IT-related occupations accounts for roughly 3,000 jobs. Several occupations support multiple sectors within the area, including the financial and corporate sectors, and are important to business operations in various other sectors. Additionally, there is a growing concentration of jobs in custom computer programming services and other sectors within the information technology business sector, and employment within that sector has doubled over the past five years.
Local Employers: Click Rain, Raven Industries, and Docutap are all local employers that depend on IT professionals to perform primary business activities, while companies, such as Citibank, Qwest, Avera, and Sanford, require IT professions to ensure that business operations run smoothly.
National Trends: Employment has grown quickly over the past ten years. Information security is essential to companies and there has been an increased demand for qualified professionals to perform the duties necessary to prevent data leaks or hacks. Additionally, globalization and technological advancements have spurned job growth within this field and have increased the need for computer programmers, software developers, computer engineers, and administrations, among other IT-related occupations.
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Occupational Outlook: Job opportunities are projected to continue to grow rapidly both in the local economy and at the national level. IT professionals are made up of a younger workforce than most occupational groups, and thus have a more sustainable employment outlook in terms of age composition; there is less of a concern regarding impending retirees within these occupations. Some of the openings within certain occupations, however, will be due to retirees. This includes employment in network and computer system administrators, computer user support specialists, and computer programmers. On the other hand, software developers and computer system analysts are projected to create roughly 215 new jobs over the next ten years. The majority will be due to newly created jobs.
Area Educational Offerings: The majority of IT jobs require formalized training and attainment of a bachelor’s degree. There are 14 programs within the Sioux Falls labor shed that provide training for information technology and computer science. Certain programs may provide training for individuals to fill multiple positions, as is seen in the completions values. There are also many options for online training for IT and computer programming professionals that enable individuals to advance their skills easier than most occupational groups.
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HEALTHCARE Current Trends Projected Growth (2014-24) Projected Demand and Supply Attributes 2014-24 2004-14 2013 Avg. Description 2014 SF % US % Pct. Pt. SF # SF # Openings 2013 Regional Earnings 2014 LQ SF % Hourly Typical Entry Level Education Jobs Chg. Chg. Difference Chg. 55+ (Growth plus Completions Ratio Chg. Earnings replacements) Registered Nurses 1.98 5,511 50.9% 21.6% 16.2% 5.4% 1,190 1,271 2,461 181 $25.90 0.78 Associate's degree Nursing Assistants 1.37 2,077 8.6% 12.7% 16.7% -3.9% 265 395 660 21 $12.13 0.97 Postsecondary non-degree award Licensed Practical and Licensed Vocational Nurses 0.92 693 8.7% 13.5% 19.9% -6.4% 93 179 273 113 $17.23 0.83 Postsecondary non-degree award Pharmacy Technicians 1.62 608 44.9% 12.8% 17.5% -4.6% 78 79 157 55 $14.14 0.93 High school diploma or equivalent Medical Assistants 0.83 507 5.5% 15.3% 21.4% -6.0% 78 50* 128 73 $13.96 0.94 Postsecondary non-degree award Pharmacists 1.70 505 36.0% 17.0% 13.5% 3.5% 86 122 208 21 $52.15 1.00 Doctoral or professional degree Radiologic Technologists 1.81 366 44.0% 19.8% 16.6% 3.2% 73 50* 123 59 $22.27 0.91 Associate's degree Medical Records and Health Information Technicians 1.90 363 41.0% 15.9% 17.9% -2.0% 58 82 139 41 $18.06 0.95 Postsecondary non-degree award Medical and Clinical Laboratory Technologists 2.16 361 19.5% 12.9% 12.1% 0.8% 47 78 124 21 $25.89 1.00 Bachelor's degree Dental Assistants 0.85 280 27.7% 25.3% 16.2% 9.1% 71 22* 93 21 $16.34 0.95 Postsecondary non-degree award Medical Transcriptionists 3.13 256 50.6% 5.1% 9.6% -4.6% 13 48* 61 21 $15.21 0.83 Postsecondary non-degree award Physical Therapists 1.16 249 40.1% 25.4% 27.4% -2.0% 63 23* 86 21 $32.57 0.81 Doctoral or professional degree Medical and Health Services Managers 0.75 243 38.3% 30.2% 18.1% 12.1% 73 70 143 14 $48.20 0.90 Bachelor's degree Surgical Technologists 2.28 235 41.8% 29.4% 23.5% 5.9% 69 22* 91 42 $18.28 0.83 Postsecondary non-degree award Nurse Practitioners 1.94 234 -24.7% 19.1% 26.3% -7.2% 45 47* 92 0 $41.76 1.12 Master's degree Medical and Clinical Laboratory Technicians 1.27 208 -2.7% 24.3% 23.3% 1.0% 50 38* 88 21 $16.01 1.32 Associate's degree Dental Hygienists 0.95 193 65.3% 31.4% 21.8% 9.5% 61 25* 86 21 $31.43 0.85 Associate's degree Physicians and Surgeons, All Other 0.53 189 31.1% 23.1% 14.0% 9.1% 44 50 94 21 $115.90 0.91 Doctoral or professional degree Opticians, Dispensing 2.53 181 37.1% 11.7% 19.9% -8.2% 21 31* 52 21 $15.51 0.90 High school diploma or equivalent Occupational Therapists 1.46 172 34.3% 22.0% 23.1% -1.2% 38 16* 54 21 $31.88 0.79 Master's degree Respiratory Therapists 1.35 164 71.0% 34.7% 16.0% 18.7% 57 27* 84 21 $22.11 0.81 Associate's degree Diagnostic Medical Sonographers 2.57 159 19.9% 33.2% 34.2% -1.0% 53 22* 75 37 $26.15 0.94 Associate's degree Physician Assistants 1.63 155 32.9% 19.8% 28.7% -8.8% 31 19* 50 21 $45.45 0.93 Master's degree Emergency Medical Technicians and Paramedics 0.56 139 47.1% 22.8% 20.2% 2.6% 32 <20 <52 21 $15.78 0.85 Postsecondary non-degree award Nurse Anesthetists 3.64 138 25.5% 10.1% 20.5% -10.4% 14 32* 46 0 $80.77 0.99 Master's degree Surgeons 2.73 132 37.4% 7.5% 16.5% -9.0% 10 26* 36 0 $107.88 1.10 Doctoral or professional degree Dentists, General 0.83 112 57.7% 13.6% 6.7% 6.9% 15 28* 43 21 $86.65 0.93 Doctoral or professional degree Cardiovascular Technologists and Technicians 1.89 100 6.7% 33.2% 24.0% 9.2% 33 14* 47 55 $24.17 1.00 Associate's degree Nuclear Medicine Technologists 4.69 97 21.4% 14.2% 16.2% -2.0% 14 13* 27 27 $25.61 1.06 Associate's degree Medical Secretaries 0.18 97 56.7% 88.5% 27.2% 61.3% 86 20* 106 6 $17.86 0.77 High school diploma or equivalent Internists, General 1.80 97 1.5% 1.9% 9.8% -7.9% 2 18* 20 0 $118.56 1.35 Doctoral or professional degree Dental Laboratory Technicians 0.73 30 57.9% 65.0% 6.1% 58.9% 19 <20 <39 0 $14.88 0.74 High school diploma or equivalent Magnetic Resonance Imaging Technologists 0.87 29 21.0% 30.4% 17.8% 12.6% 9 <20 <29 38 $24.40 0.77 Associate's degree Radiation Therapists 0.86 15 19.7% 36.8% 17.8% 19.0% 6 <20 <29 45 $37.77 0.96 Associate's degree
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Profile: The Health care and social assistance sector accounts for 16.8 percent of total jobs in the local economy, a stronger concentration than what it seen nationally, which is mostly attributed to the presence of two large medical facilities – Avera McKeenan Hospital and Sanford Health – that employ a vast number of residents in the area. Overall, employment within the occupations listed is projected to grow by 19.4 percent, while nationally employment within these fields is estimated to increase by 18.2 percent. Several occupations listed have experienced above average growth over the past ten years, some with more than 50 percent growth rates, including registered nurses, physical therapists, and radiologic technologists.
Local Employers: Sanford Health and Avera McKeenan Hospital employ thousands of residents at their multiple facilities. Employment at hospitals in the Sioux Falls area accounts for over 13,000 workers alone.
National Trends: Employment is projected to continue to increase at above average rates. Demand for health care services is also expected to grow, in part, due to the large numbers of Americans from the baby boomer generation that will likely require additional services from age-related ailments. Advancements in technology have also supported improvements in treatments that have contributed to longer life expectancies.
Occupational Outlook: Several occupations within the health care sector were discussed throughout the report and the employment outlook for occupations is this field is strong. Every occupation listed on the table is expected to experience some level of employment growth, over half of which are projected to grow at faster rates than the national average.
Area Educational Offerings: The majority of occupations listed require higher levels of education and training. The Sanford School of Medicine at the University of South Dakota offers a pool of talented doctors to supply the area with qualified workers. Sanford’s USD Medical Center in Sioux Falls is the teaching hospital for the program and provides students with the proper training needed to fill a number of positions. Avera McKennan School of Radiologic Technology, USF, and Sanford Medical Center all offer medical radiologic technology programs that work to create a pipeline of skilled workers. Although the number of completions in 2013 indicates that there may be a shortage of qualified workers, the fact that most of the training is done in-house enables the employer to directly connect with students and to increase output of certificates when required, thereby making it less vulnerable than other occupations where gaps in communication may exist between schools and businesses. Augustana College and Southeast Technical Institute also offer a variety of quality health professions and related programs that contribute to the supply of talented
Page 67 – April 2015 Workforce Sustainability Analysis workers within the field. Input reported that there is a strong partnership between the health care sector and the higher education system in the area to help align programs with the needs of the local establishments.
FINANCE AND CUSTOMER-CARE
Current Trends Projected Growth (2014-24) Projected Demand and Supply Attributes 2014-24 2004-14 2013 2013 Avg. Description 2014 SF % US % Pct. Pt. SF # SF # Openings Earnings 2014 LQ SF % Regional Hourly Typical Entry Level Education Jobs Chg. Chg. Difference Chg. 55+ (Growth plus Ratio Chg. Completions Earnings replacements) Customer Service Representatives 1.75 4,442 19.6% 5.8% 14.1% -8.3% 259 662 921 0 $13.11 0.82 High school diploma or equivalent Bookkeeping, Accounting, and Auditing Clerks 1.61 2,966 21.6% 6.1% 12.0% -5.9% 180 874 1,054 11 $14.87 0.83 High school diploma or equivalent Bill and Account Collectors 5.51 2,131 3.0% -2.6% 14.8% -17.4% -56 314 258 11 $14.45 0.87 High school diploma or equivalent Secretaries and Administrative Assistants** 0.72 1,940 15.6% 11.5% 12.9% -1.3% 223 568 792 1 $13.26 0.81 High school diploma or equivalent Receptionists and Information Clerks 1.69 1,809 16.1% 6.0% 11.9% -5.9% 109 381 490 42 $12.21 0.92 High school diploma or equivalent Accountants and Auditors 1.18 1,625 28.7% 5.6% 12.5% -6.8% 91 360 452 76 $29.98 0.88 Bachelor's degree Insurance Sales Agents 2.14 1,616 53.9% 8.4% 9.7% -1.3% 135 414 549 3 $27.49 0.94 High school diploma or equivalent Loan Interviewers and Clerks 3.93 861 0.8% 4.0% 9.0% -5.0% 34 84* 118 11 $15.39 0.86 High school diploma or equivalent Insurance Claims and Policy Processing Clerks 3.13 781 41.4% 6.3% 10.3% -4.0% 49 149 198 6 $14.37 0.79 High school diploma or equivalent Loan Officers 2.18 675 -2.0% 7.8% 7.8% 0.0% 53 91 144 6 $25.63 0.74 Bachelor's degree Financial Analysts 2.43 655 21.7% 5.9% 16.1% -10.2% 38 59 97 12 $30.52 0.70 Bachelor's degree Telemarketers 1.76 446 23.4% -10.5% 11.4% -21.9% -47 65 18 22 $13.31 1.06 Less than high school Claims Adjusters, Examiners, and Investigators 1.37 407 23.8% 2.3% 6.7% -4.4% 9 84 93 3 $27.73 0.93 High school diploma or equivalent Compliance Officers 1.56 393 27.7% 5.6% 8.0% -2.4% 22 105 126 0 $28.08 0.87 Bachelor's degree Financial Managers 0.56 305 -3.8% 19.0% 10.2% 8.8% 58 49* 107 12 $60.83 1.01 Bachelor's degree Market Research Analysts and Marketing Specialists 0.59 287 22.8% 27.0% 28.6% -1.6% 77 30* 107 1 $24.21 0.75 Bachelor's degree Securities, Commodities, and Financial Services Sales Agents 0.70 254 -9.3% 13.3% 8.2% 5.1% 34 30* 64 0 $62.85 1.32 Bachelor's degree Credit Analysts 3.55 241 -1.3% 2.5% 12.3% -9.8% 6 26* 32 76 $30.46 0.87 Bachelor's degree Insurance Underwriters 2.51 241 13.7% -11.0% -1.5% -9.5% -26 45* 19 3 $33.53 0.99 Bachelor's degree Compensation, Benefits, and Job Analysis Specialists 2.27 196 43.4% 5.2% 9.1% -3.9% 10 31* 41 2 $24.06 0.79 Bachelor's degree Credit Authorizers, Checkers, and Clerks 3.78 192 -11.6% -8.7% 2.2% -10.9% -17 28* 11 11 $13.81 0.81 High school diploma or equivalent Correspondence Clerks 19.55 163 23.2% 1.9% 10.0% -8.1% 3 32* 35 6 $13.72 0.79 High school diploma or equivalent ** Except Legal, Medical, and Executive Profile: The Sioux Falls region has historically had a strong concentration of jobs and companies operating in finance and customer care. Employment within these occupations has grown over the past ten years, despite recent losses within several areas which were largely attributed to the Great Recession. The strong concentration of jobs within these occupations is seen in their high location quotients. Bill and account collectors have five times the share of jobs than they do on average nationally. Many of the occupations listed provide support in other business sectors, such as secretaries, accountants, and bookkeeping clerks. Employment within these occupations is projected to grow at a slower rate than the national average.
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Local Employers: Sioux Falls is home to many large national employers such as, Citi, Wells Fargo, Capital One, and Esurance. Premier Bankcard is headquartered in Sioux Falls and is a large presence in the community.
National Trends: Employment within these occupations as a whole is projected to grow by roughly 12.5 percent, with employment growth varied over the occupations. Insurance underwriters is the only occupation expected to decline. The drop in demand for individuals to perform the job duties associated with insurance underwriting is attributed to technological advancements with automated underwriting software enabling increased productivity among employees, thereby decreasing the number of workers needed for the same amount of output.
Occupational Outlook: As was discussed in the section on expectations for the next ten years, technological advancements leave many occupations within this sector vulnerable to shrinkage due to computerization. A large number of residents are employed within these occupations and may be susceptible to job loss if computerization and increased efficiencies lead to fewer levels of employment within their occupation. About 20 percent of total workers in these occupations are over the age of 55, with varying degrees of aging workers. Occupations with large numbers of employees susceptible to retirement should be examined to ensure that there are no shortages that would prevent business activities from operating as normal.
Area Educational Offerings: Roughly half of the occupations listed require a high school degree as the highest level of education needed to satisfy requirements. The data suggest that the pipeline for accountants should be able to meet both the growing demand and the larger than average number of employees nearing the age of retirement. However, this operates under the assumption that the area is able to retain the residents that are graduating from local colleges. Compliance officers are projected to grow at slower than average growth rates, yet the region has an aging workforce within this field of work. Although the data suggest that there are no completions that align with this occupation, other degrees may be able to prepare individuals to fill openings.
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ADVANCED MANUFACTURING
Current Trends Projected Growth (2014-24) Projected Demand and Supply Attributes 2014-24 2004- 2013 Avg. Description 2014 SF % US % Pct. Pt. SF # SF # Openings 2013 Regional Earnings 2014 LQ 14 SF % Hourly Typical Entry Level Education Jobs Chg. Chg. Difference Chg. 55+ (Growth plus Completions Ratio Chg. Earnings replacements) Heavy & Tractor-Trailer Truck Drivers 1.52 2,850 0.4% -3.1% 10.9% -14.0% (87) 864 777 0 $18.73 0.97 Postsecondary non-degree award Laborers & Freight, Stock, & Material Movers, Hand 1.03 2,550 16.0% 9.6% 12.4% -2.8% 244 368 612 0 $12.37 0.96 Less than high school Sales Representatives, Wholesale & Manufacturing** 1.43 2,197 22.4% 7.6% 10.9% -3.3% 167 539 706 22 $27.54 0.90 High school diploma or equivalent Team Assemblers 1.16 1,312 34.0% 13.4% 6.6% 6.8% 176 197 373 0 $12.09 0.82 High school diploma or equivalent Packers & Packagers, Hand 1.09 786 17.5% 9.0% 9.0% 0.0% 70 132 203 0 $10.73 0.98 Less than high school Welders, Cutters, Solderers, & Brazers 1.90 758 33.7% 17.8% 7.9% 9.9% 135 82* 217 11 $16.55 0.89 High school diploma or equivalent First-Line Supervisors of Production & Operating Workers 0.62 381 6.0% 17.2% 2.2% 15.0% 66 62* 128 0 $26.41 0.95 Postsecondary non-degree award Electrical & Electronic Equipment Assemblers 1.68 348 39.7% 15.7% 1.7% 14.1% 55 100 155 0 $12.92 0.86 High school diploma or equivalent Inspectors, Testers, Sorters, Samplers, & Weighers 0.65 327 17.4% 19.7% 9.0% 10.7% 65 71 135 0 $14.45 0.79 High school diploma or equivalent Coating, Painting, & Spraying Machine Setters, *** 3.20 294 51.7% 12.3% 3.8% 8.5% 36 28* 64 0 $13.08 0.85 High school diploma or equivalent Industrial Machinery Mechanics 0.83 279 31.3% 25.7% 19.4% 6.3% 72 54* 126 0 $19.16 0.81 High school diploma or equivalent Extruding, Forming, Pressing, & Compacting Machine Setters, *** 3.51 254 33.8% 8.1% -0.2% 8.3% 21 34* 55 0 $15.36 0.96 High school diploma or equivalent Molding, Coremaking, & Casting Machine Setters, ***^ 1.94 249 49.6% 1.3% -5.7% 7.0% 3 31* 34 0 $14.61 1.00 High school diploma or equivalent Cutting, Punching, & Press Machine Setters, ***^ 1.27 247 32.3% 6.4% -2.8% 9.3% 16 34* 50 0 $14.73 0.97 High school diploma or equivalent Machinists 0.57 236 30.6% 20.0% 11.8% 8.2% 47 42* 89 1 $17.52 0.89 High school diploma or equivalent Extruding & Drawing Machine Setters, ***^ 2.21 167 43.7% 2.6% -6.1% 8.7% 4 21* 25 0 $12.51 0.78 High school diploma or equivalent Mechanical Engineers 0.50 137 26.9% 24.8% 8.8% 16.0% 34 21* 55 0 $34.05 0.83 Bachelor's degree Industrial Engineers 0.50 121 22.9% 26.0% 8.2% 17.7% 31 21* 52 9 $32.62 0.81 Bachelor's degree Industrial Production Managers 0.56 98 10.1% 20.6% 2.1% 18.4% 20 18* 38 360 $41.54 0.88 Bachelor's degree Tool & Die Makers 1.12 93 84.9% 6.1% 2.2% 3.9% 6 22* 28 0 $21.55 0.91 High school diploma or equivalent Structural Metal Fabricators & Fitters 0.96 79 9.4% 31.6% 10.2% 21.4% 25 10* 35 1 $14.95 0.82 High school diploma or equivalent Welding, Soldering, & Brazing Machine Setters, *** 1.39 78 44.0% 31.6% 19.0% 12.6% 25 <20 <45 11 $16.42 0.96 High school diploma or equivalent Computer-Controlled Machine Tool Operators^ 0.45 67 43.5% 35.4% 16.5% 18.9% 24 <20 <44 1 $18.07 1.01 High school diploma or equivalent Electrical Engineers 0.34 61 -2.8% 34.8% 10.1% 24.8% 21 11* 32 0 $37.71 0.84 Bachelor's degree Electrical & Electronics Engineering Technicians 0.36 53 -22.6% 27.4% 6.1% 21.3% 15 10* 25 0 $23.69 0.84 Associate's degree Electrical & Electronics Drafters 0.38 12 9.6% 34.8% 12.6% 22.3% 4 <20 <24 0 $22.56 0.78 Associate's degree ** Except Technical and Scientific Products *** Operators, & Tenders ^ Metal and Plastic Profile: Occupations within this field have experienced fast growth rates over the past ten years and are projected to continue to grow at fast rates, outpacing the national projected growth rate in nearly every occupation listed. The region’s strength in skilled trades has enabled the area the take advantage of additional opportunities. The strong health care sector also has influenced the advance manufacturing field, with the region positioned well to expand in biomedical device manufacturing.
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Local Employers: Midwest Precision SD, Dignity Medical Devices, Raven Industries, and Orthotic & Prosthetic Specialties are among some of the local companies operating in biomedical device or advanced manufacturing.
National Trends: Employment is projected to grow in nearly every occupation nationally, with the Sioux Falls region expected to grow at similar rates. Advanced manufacturing operations have continued to grow in many metropolitan areas across the United States and stand to continue expanding. The Sioux Falls area has a higher concentration of jobs in many occupations than the nation.
Occupational Outlook: There will be a large number of openings for jobs projected over the next ten years. Although a smaller share of these jobs will stem from growth, this sector has some of the most disadvantage age ratios and the region stands to suffer from large numbers of workers retiring over the next decade if qualified workers are not found or trained. Roughly 70 percent of the estimated future openings stem from replacements due to retirements. Earnings are lower than the national average, which acts as a disadvantage for attracting workers to the area. Increased pressures are likely to be put on wages if employment openings are not filled. In total, there will be an estimated 4,000 openings for workers to fill over the coming decade.
Area Educational Offerings: Many of the occupations listed require lower levels of education requirements, but higher levels of skills that can be obtained either on the job or at post-secondary institutions. Input related to talent needs was most acute for occupations within this field, as was discussed throughout the report. Welders, machinists, truck drivers, engineers, mechanics, and laborers were just a few of the occupations cited by employers that were difficult to fill with qualified workers. The area’s educational offerings indicate that degreed output of these workers is not meeting the current need and is not positioned to meet the future demand. Heavy and tractor-trailer truck drivers have an aging workforce and local residents need to be able to get certified to fill those occupations that will be left open in the near future. Certifications and short-term training at the area’s post-secondary institutions would help to alleviate the stress that is being put on employers.
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BIOTECHNOLOGY
Current Trends Projected Growth (2014-24) Projected Demand and Supply Attributes 2014-24 2004-14 2013 Avg. Description 2014 2014 SF % US % Pct. Pt. SF # Openings 2013 Regional Earnings SF % SF # 55+ Hourly Typical Entry Level Education LQ Jobs Chg. Chg. Difference Chg. (Growth plus Completions Ratio Chg. Earnings replacements) Environmental Scientists and Specialists** 1.06 99 58.6% 12.5% 15.6% -3.1% 12 <28 <40 0 $40.17 1.18 Bachelor's degree Biological Technicians 0.71 53 59.9% 18.2% 13.2% 5.0% 10 <20 <30 0 $16.37 0.78 Bachelor's degree Medical Scientists, Except Epidemiologists 0.43 47 48.4% 25.2% 15.0% 10.2% 12 <20 <22 5 $32.02 0.74 Doctoral or professional degree Chemists 0.44 40 76.3% 18.1% 8.9% 9.2% 7 <20 <27 7 $29.63 0.79 Bachelor's degree Soil and Plant Scientists 2.33 40 63.5% 5.7% 13.0% -7.3% 2 <20 <22 0 $32.81 1.14 Bachelor's degree Chemical Technicians 0.58 39 138.9% 25.8% 11.9% 13.8% 10 <20 <30 0 $19.25 0.86 Associate's degree Agricultural and Food Science Technicians 1.71 38 23.0% -3.1% 10.5% -13.6% (1) <20 <19 0 $16.01 0.90 Associate's degree Chemical Equipment Operators and Tenders 0.59 37 156.5% 26.6% -1.0% 27.6% 10 <20 <30 0 $16.09 0.69 High school diploma or equivalent Microbiologists 1.56 33 63.0% 7.0% 11.0% -4.0% 2 <20 <22 0 $28.00 0.77 Bachelor's degree Environmental Science and Protection Technicians** 0.61 22 64.4% 27.9% 19.4% 8.5% 6 <20 <26 0 $17.13 0.78 Associate's degree Chemical Plant and System Operators 0.42 17 N/A 37.2% -0.5% 37.7% 6 <10 <16 0 $19.14 0.73 High school diploma or equivalent Biomedical Engineers 0.24 <10 N/A N/A 26.9% N/A N/A <10 <10 0 N/A N/A Bachelor's degree Chemical Engineers 0.19 <10 N/A N/A 10.5% N/A N/A <10 <10 0 N/A N/A Bachelor's degree Animal Scientists 0.51 <10 N/A N/A 8.6% N/A N/A <10 <10 0 N/A N/A Doctoral or professional degree Food Scientists and Technologists 0.55 <10 N/A N/A 13.6% N/A N/A <20 <10 0 N/A N/A Bachelor's degree Biochemists and Biophysicists 0.17 <10 N/A N/A 18.8% N/A N/A <10 <10 5 N/A N/A Doctoral or professional degree Epidemiologists 1.32 <10 N/A N/A 7.8% N/A N/A <20 <10 0 N/A N/A Master's degree ** Including Health Profile: The Sioux Falls area has a growing number of companies involved in biomedical, biopharmaceuticals, and biomass research. The area is conducting significant research on breast cancer, Type I diabetes, genetics, human antibodies, and agricultural biotechnology, which has positioned it as a magnet for talent in this field of research. Employment has more than doubled for jobs such as chemical technicians and chemical equipment operators and tenders. Growth rates were high across the board for the occupations listed in biotechnology; the location quotient in five of the jobs listed illustrates the stronger than average presence of employment within this field.
Local Employers: Sanford Research, Avera McKennan Hospital and University Health Center, SAB Biotherapeutics, and POET-DSM Advanced BioFuels are just some of the major local employers that are making significant impacts in the biotech world. While biomedical research arguably dominates the biotech influence in the area, the region’s strong agriculture sector has offered opportunities for advancements in technology through the use of cattle and corn.
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National Trends: Employment nationally is expected to have strong growth rates over the next ten years. Occupations in the areas of science, technology, engineering, and math offer high wages to workers. Growing advancements in technology are likely to continue demanding more workers with this area’s business activities.
Occupational Outlook: Although employment growth within this field accounts for a smaller number of jobs, the education requirements are high for these occupations. It takes years of education and training to become qualified to fill the majority of positions. A long-term vision is needed to ensure that there will be a workforce available for future employment opportunities. Due to the small number of employees that work within these occupations, there were a number of data suppressions, but the national projected growth indicate that there will be a growing number of newly created jobs within this field. Additionally, the growth projected for total jobs that were not suppressed suggests that the employment in the Sioux Falls region will grow at a faster rate than the national average.
Area Educational Offerings: The aforementioned educational offerings regarding healthcare also strengthen the region’s ability to support increasing biomedical research. Additionally, the University Center’s recent expansion that is set to house goods manufacturing practices will be a valuable resource to continue growth within this field. The additional space will enable companies and researchers to produce pharmaceuticals, biological, and medical devices for trial areas, which will offer opportunities to improve the area’s presence of companies and workers operating in biotech. The GEAR Center also offers an extremely important educational offering with USD’s Biomedical Engineering program. An increased output of engineers will likely be needed in order to continue growing and supporting this sector. The new USD Discovery Center and its focus on biotech will also help greater Sioux Falls to develop and foster growth within the region.
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